Explain. Answer) In this course we have studied 6 IAS which are: IAS 1- tells us about the presentation of financial statements, the overall and minimum requirements and in which manner we should structure them, it also outlines all the principles and requires a set of financial statements to be prepared which are the balance sheet, income statement, statement of cash flows, statement of equity, notes to the accounts. IAS 7 – requires a company to prepare the statement of cash flows and it is one the main part of the financial statements. The cash inflow and out flows are classified in to operating activities, investing activities and financing activities. IAS 16 – tells us about the accounting treatment for property plant and equipment, i.e.
Standards issued by the IASC were referred to as International Accounting Standards (IAS), and consequently incorporated into IFRS, which in turn led to the international accounting standards currently being used. Although the practice of IFRS development occurred for a relatively long period, the adoption process by each country varied in time. In recent years, numerous countries have adopted the IFRS including Australia, Brazil, the European Union (EU), South Africa and more (PwC, 2013). The extensive adoption on a global scale gave rise to the increasing interest in IFRS among capital market participants, whom are concerned with the impact of the transition to the new standards on accounting quality
Though it is at times need for estimation the amount or timing of receivables, and unbelief is mostly many less than the provisions. Often it reported as part of the benefits of trade accounts and another payable, whilst provisions reported on separately. Scope IAS 37 eliminates requirements and possibilities rising of: [IAS 37.1-6] • 1) Fiscal implements that stand in the choice of IAS 39 fiscal tools: Confession and dimension (or IFRS 9 Financial Appliances). 2) Non-substantial executory agreements. 3) Insurance decades (see IFRS 4 Insurance decades), but IAS 37 does put on to other supplies, potential accountabilities and potential assets from an insurance company.
There is no any adoption of IAS 38 but there is adoption of IAS 39 . Task 2 /M2: I will be assessing the impact of adjustments to profit and loss account and balance sheet items for a limited company . Adjusting entries are part of accounting journal entries which convert a company's accounting records to the accrual basis of accounting , especially to issue the company's financial statement. Trial balance Is a report run which comes at the end of an accounting period, listing the ending balance in each account . Cash is still 22,000$ no changes have been made to in the trial balance .
FINANCIAL ACCOUNTING Q1. Critically discuss the role, objectives and limitations of published annual financial statements for companies, and discuss the reasons for, and sources of regulation of the content and format of those financial statements Abstract This paper explains the financial accounting process in different business entities. The accounting process requires organizations to provide detailed and accountable statements regarding their firms’ activities. The statements range from income statements, balance sheets and the cash flows statements. The different statements have various roles, goals and limitations pertaining to each one of them.
Answers for Candy a) Type of information each financial statement provides • Balance sheet Balance sheet reported assets, liabilities and stockholders' equity. Assets represent all the elements that a company owns and uses to generate revenue. Liabilities include money owed to creditors of assets or other financing purposes. The assets include investments made in the business or the capital invested by the owners (Collier, 2015). • Income statement The income statement reports the profit of the company during a given accounting period.
Part C of the code describes examples of threats that could be encountered and likely safeguards that can be useful to make sure that threats are either eliminated or reduced to acceptable level. It does not explain all potential situation or relationships that members in business might come across that could create threats to compliance with fundamental principles members are encourage to be alert and may consider obtaining legal advice if they believe unethical behaviour will continue to occur within the employing organisation. The FIA code of ethics dose not apportions its principles and rules in this manner. (APES 110 Code of Ethics for Professional Accountants,
It is because of this basic accounting principle that numerous pages of "footnotes" are often attached to financial statements. As an example, let 's say a company is named in a lawsuit that demands a significant amount of money. When the financial statements are prepared it is not clear whether the company will be able to defend itself or whether it might lose the lawsuit. As a result of these conditions and because of the full disclosure principle the lawsuit will be described in the notes to the financial statements. A company usually lists its significant accounting policies as the first note to its financial
1 details that financial information should be useful for all users especially investors and creditors: “Financial reporting should provide information that is useful to present and potential investors and creditors and other users [including financial analysts, journalist, regulatory authorities and trade unions] in making rational investment, credit, and similar decisions”. According to SFAC No. 1, FASB emphasised the understandability of the financial information, stating that: “the information should
Income data (experiences, estimates of sales, fund rising, membership etc and planned activities). Data come from previous budgets, estimates, experience of others and public available statistics. I was also able to identify the main uses of accounting and these are as follow: Information All organizations need to keep records of their financial transactions so that they can access Information about their financial position, including: summary of income and expenditure, the outcome of all operations, assets and liabilities. Legal requirement There is often a statutory obligation to keep and publish accounts and donor agencies almost always require audited accounts as a condition of grant aid. Future planning Although financial accounting information is historical (i.e.