Financial Accounting and Reporting - PDF
Added on 2019-12-04
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Financial Accounting and Reporting
TABLE OF CONTENTSINTRODUCTION ..........................................................................................................................1TASK 1............................................................................................................................................11. Stating the influences of legal and regulatory framework on the financial statements of firm.....................................................................................................................................................12. Assessing the implications of legal and regulatory influences on the different users offinancial statements.....................................................................................................................1PART B............................................................................................................................................2A and b). Stating the operating profit and income statement .....................................................2c. Statements of the financial position for 31st January 2011.....................................................3d). Impact on bank a/c, ordinary share capital a/c and share premium if Atlas plc issues 10million shares @ £1.50 each ......................................................................................................3REFERENCES................................................................................................................................5
INTRODUCTION Financial accounting may be defined as a process in which accountant record all thefinancial transactions by taking into consideration the standardized guidelines. This report willexamine the extent to which legal and regulatory framework has influences upon the financialstatements of the firm. TASK 11. Influences of legal and regulatory framework on the financial statements of firmAccording to the Company Act, 2006 of UK, business organizations have to prepareMemorandum of association, Article of association, minimum share capital as well as othernecessary documents which are required for the incorporation of company. Article 4 ofInternational Accounting standards entails that directors require preparing all the financialstatements which are mentioned in such article (Bradshaw and et.al, 2013). Besides this, inaccordance with the section 386, each and every business entity needs to present updated recordof their financial transactions which are made by them during the accounting year. Thus, laws and legislation entails that company has to provide all the information to theirstakeholders about the income, expenses as well as assets and liabilities. In addition to this,company also requires to give information about their cash related activities such as operating,financing and investing activities (Coeurderoy and Murray, 2014). Along with this, companyalso has legal obligations to follow accounting concepts and principles namely; materiality,consistency, fair view etc. All these legislative aspects have high level of influence upon thefinancial statement which is prepared by the firm.2. Assessing implications of legal and regulatory influences on the different users of financialstatementsSpecifically, managers, suppliers, shareholders, financial institution, government andemployees etc. are the main user of the financial statements. They undertake financial statementsof the firm to make effectual decisions in relation to their investment or well being. Informationneed of the different kind of users is enumerated below:Managers: They are main stakeholders of financial statement who frames strategies andpolicies by conducting in-depth analysis of all the financial transactions. Thus, section 7of IAS provides deeper insight to the manager’s analysis about the cash related activities1
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