Financial Accounting Principles- Doc

FINANCIAL ACCOUNTING PRINCIPLES

Table of Contents
INTRODUCTION...........................................................................................................................3
Main Body.......................................................................................................................................3
A. Defining financial Accounting and its purpose......................................................................3
B. Explaining the regulation relating to the financial accounting...............................................4
C. Describing accounting rules and principles............................................................................4
D. Explaining the conventions and concepts relating to consistency and material disclosure.. .5
CLIENT 1........................................................................................................................................6
CLIENT 2........................................................................................................................................8
CLIENT 3......................................................................................................................................10
C) Explaining concepts of consistency and prudence...............................................................13
D) Purpose of depreciation and methods of calculating depreciation.......................................13
CLIENT 4......................................................................................................................................14
Purpose of preparing bank reconciliation statement.................................................................14
Explaining areas which cause record vary with bank records..................................................14
Preparing accounts through cash flow statement......................................................................14
CLIENT 5......................................................................................................................................15
A). Preparing control accounts..................................................................................................15
B) Explaining need of preparation of control account..............................................................16
CLIENT 6......................................................................................................................................16
A) Meaning of suspense account and highlighting features.....................................................16

B. Drafting a trail balance.........................................................................................................17
C Trial balance suspense account.............................................................................................17
D) Differentiate between suspense and clearing account.........................................................18
CONCLUSION..............................................................................................................................18
REFERENCES..............................................................................................................................19

INTRODUCTION
Financial accounting is an important field for ant organisation. It helps in in recording and summarising the financial
transaction of a company that helps in preparing the financial statements and financial reporting of the company for the external users .
This statements are very helpful for the external users in order to make their decisions regarding the investment in the company. The
present report will help in understanding the financial accounting and the purpose of preparing it. The report will also discuss the
various regulations and standard related to the financial accounting. Further the report will include the accounting rules and principles.
The report will include the consistency and full disclosure principle of accounting. Furthermore, the report will include calculations of
the financial statement for the different clients.
Main Body
A. Defining financial Accounting and its purpose.
It is the process of tracking all the financial transaction of a company. With the help of a specialised guidelines, financial
accounting helps the transaction to be properly recorded, summarised and presented is well manner form of a report which are known
as financial statements or reports. Financial accounting focus on providing the information of the financial performance and the
business activities of the company to the external users of the company like shareholders, investors and other people outside the
business organisation (Edwards, 2013). Financial information of the company are summarised in the form of the financial statements,
which are balance sheet, income statements, profit and loss statements etc.
Financial statesman are being prepared on the routine schedules that is quarterly, half-yearly or annually. These statements are
important to external users of the business organisation that helps them to make decisions regarding investing in the company or not.
The financial reporting is also very helpful for the management also in order to make decisions and strategies for further growth and
development of the company.
The main purpose of the financial accounting are as follows:

 The main purpose of the financial accounting is to create information of the financial performance of the company in a form of
financial statements.
 The financial statement should be in a form that can be understand by the external users which helps them in making the
decisions regarding the investment purpose in company.
B. Explaining the regulation relating to the financial accounting.
Financial accounting is the preparation of financial statements by analysing, summarising and reporting all the financial data.
It helps the external users to understand the financial performance of the company.
Financial accounting is governed by by local as well as the international accounting standard for financial reporting. Following
are the regulations related to the financial accounting
GAAP: Generally Accepted Accounting Principles are the commonly followed accounting rules and standards for financial reporting
(Horngren and et.al., 2012). This regulation helps in ensuring that the financial reporting is transparent and consist of relevant
information of financial performance.
IFRS: International Financial Reporting Standard is a set of the standard that provide a frameworks to the companies the way to
prepare and disclose their financial statements. IFRS helps in providing the general guidance for the preparation of the financial
statements . It is important for the companies to adopt a global level standard that will help them to simply the procedures by allowing
a company to use one type of accounting all over thee world.
IASB: International Accounting Standard Board is the organisation that established the IFRS all over the world. This organisation is
consist of the 14 members from all over the world that helps in setting the accounting standard, preparing the accounting reports and
accounting educations.

C. Describing accounting rules and principles.
Accounting is the process of summarizing, organising and recording in a terms of money, transactions which helps in
understanding the business activities of the organisation (May, 2013). Accounting not just record the financial transactions of the
company but also helps in analysing and converting them in the manner that can be understandable to both company and to the
external users. It can be presented in the form of the financial information.
There are general rules and concepts which govern the field of accounting. The rules of accounting refereed to as basic
accounting principles and guidelines. The Financial Accounting Standard Board(FASB) are using the basic accounting standard and
guidelines as basis of the set of accounting rules and guidelines.
The basic rules of accounting as per the FASB , that if a company is distributed its financial statements to the public, it
required to follow the guidelines by GAAP (Henderson and et.al., 2015). It is an important regulation as it helps in regulate
accounting definitions, assumptions and ,method of accounting. Following are some accounting principles which are widely used in
accounting:
 Economy Entity assumptions
 Monetary unit Assumptions
 Time period assumptions
 Cost principles
 Full disclosure principles
 Going concern principles
 Matching principles (What are Accounting Principles | List of Top Accounting Principles , 2019).
 Revenue recognition

 Materiality
 Conservatism
D. Explaining the conventions and concepts relating to consistency and material disclosure.
Consistency:
It is the concept of the accounting principles which states that the company should follow the same accounting method for
over and over again. Consistency concept assumes that an accounting procedure or method once adopted should be applied
consistently in future also (Macve, 2015). If a company is using a method this year and changes subsequently to another method the
very next year it will be difficult for the users to compare the financial statements of different year.
The principles also implies that a business can change its method of accounting treatment but only when there are sound and
valid reasonable grounds. The company has to make sure that the reason for changing the method and the detail of treatment of the
new method should be be disclose in its annual financial reports and statements. This concept is important because of the need of
comparability of the financial statements by the external users.
Material Disclosure:
According to this conventions of the accounting principles, the company while preparing the income statement should disclose
each relevant information in the footnote of the statements. The information can be related to the function of its financial statements or
the business activity. This principles helps to ensure the stockholders and investors are not misguided with any aspects of the financial
report (Barth, 2015). The management of the company has to report all the information about the company's operations to creditors
and investors in their accounting reports.
The relevant information can be anything that could change the decisions of the outside users of the accounting reports
external user can analyse such information and interpret these financial statements to make informed and detailed decisions. Thus full

disclosure principle of accounting emphasizes that any piece of data that can change the decisions of the external users should be
included in the report.
CLIENT 1
Journal entries in the book of David Study’s for the month of January are as follows:
Date Particulars Debit Credit
1st Jan
2018
Storage expenses a/c Dr.
To bank a/c
800
800
2nd Jan
2018
Purchase a/c Dr.
To S. Hamid a/c
To D. Main a/c
To W. Tag a/c
To R. Foot a/c
7680
2450
2560
1060
1610
3 Jan
2018
J Wilson a/c Dr.
T. Cole a/c Dr.
F. Seema a/c Dr.
J. Allen a/c Dr.
P. White a/c Dr.
F. Lane a/c Dr.
To sales a/c
2020
1840
2380
990
2820
1170
11220
4 Jan
2018
Motor car expenses a/c Dr.
To cash a/c
670
670
7 Jan
2018
Drawing a/c Dr.
To cash a/c
2000
2000
9 Jan
2018
T. Cole a/c Dr.
J. Fox a/c Dr.
To sales a/c
1280
2310
3590
11 Jan
2018
Sales return a/c Dr.
To J. Wilson
To F. Seema a/c
680
370
310
16 Jan (a). Bank a/c Dr. 1520

2018 Discount allowed a/c Dr.
To P Mole
(b)
Bank a/c Dr.
Discount allowed a/c Dr.
To F. Lane
(c)
Bank a/c Dr.
Discount allowed a/c Dr.
To J. Wikson
(d)
Bank a/c Dr.
Discount allowed a/c Dr.
To F. Seema
80
3040
160
836
44
1397
74
1600
3200
880
1470
19 Jan
2018
R. Foot a/c Dr.
To purchase return a/c
110
110
22 Jan
2018
Purchase a/c Dr.
To L. Mole a/c
To W. Wright a/c
3140
1330
1810
24 Jan
2018
a.
S. Hamid a/c Dr.
To Bank a/c
To Discount receive a/c
b.
J. Brown a/c Dr.
To Bank a/c
To Discount receive a/c
c.
R. Foot a/c Dr.
To Bank a/c
To Discount receive a/c
2600
3300
1600
2340
260
2970
330
1440
160
27 Jan
2018
Salaries a/c Dr.
To bank a/c
14500
14500

30 Jan
2018
Business rates a/c Dr
To bank a/c
2220
2220
Ledgers
PURCHASES DAY BOOK PURCHASES RETURNS DAY BOOK
DATE
2017 DETAILS £ DATE
2017 DETAILS £
May-02 s hlmd 10150
CR EACH
INDIVIDUAL
A/C
May
d main 2560 May-19 r foot 110
DR EACH
INDIVIDUAL
A/C
w tag 1060 CR PURCHASES RETURNS A/C 110
r foot 1610
May-22 L mole 1330
W wright 1810
DR PURCHASES A/C 18410
sales DAY BOOK Sales RETURNS DAY BOOK
DATE 2017 DETAILS £ DATE
2017 DETAILS £
May-03 j wilson 2020
DR EACH
INDIVIDUAL
A/C
May
t cole 1840 May-11 j wilson 370
CR EACH
INDIVIDUAL
A/C
f syme 2380 f syme 310
j allen 990 DR SALES RETURNS A/C 680
p white 2820
f lane 1170

May-09 T cole 1280
j fox 2310
CR SALES A/C 14810
Cash Book
DATE
2017 receipts discount
allowed cash bank DATE
2017 Payments discount
Received cash bank
MAY £ £ £ MAY £ £ £
May-01 BALANCE B/d 10600 42400 May-01 storage costs 800
May-16 P mole 80 1600 May-04 motor expenses 670
F lane 160 3200 May-07 drawings 2000
J wilson 44 880 May-24 s hamid 260 2600
F seema 73.5 1470 j brown 330 3300
r foot 160 1600
May-27 Salaries 14500
May-30 Business rates 2220
0 May-31 BALANCE C/f 2930 24530
357.5 5600 49550 750 5600 49550
Jun-01 BALANCE B/d 392.5 3630 24530
S Hamid ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-24 cash book 11585 May-01 BALANCE B/d 10150
May-24 discount RECEIVED 1015 May-02 Purchases day book 2450

12600 12600
closed
J BROWN ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-24 cash book 8640 May-01 BALANCE B/d 9600
May-24 discount RECEIVED 960
9600 9600
closed
D MAIN ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 balance c/f 2560 May-02 Purchases day book 2560
2560 2560
Jun-01 balance b/d 2560
W Tag ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 balance c/f 1060 May-02 Purchases day book 1060
1060 1060
Jun-01 balance b/d 1060
R FOOT ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-19 Purchases returns 110 May-02 Purchases day book 1610

May-24 cash book 1600 May-31 balance c/f 260
May-24 discount RECEIVED 160
1870 1870
L MOLE ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 balance c/f 1330 May-22 Purchases day book 1330
1330 1330
Jun-01 balance b/d 1330
W WRIGHT ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 balance c/f 1810 May-22 Purchases day book 1810
1810 1810
Jun-01 balance b/d 1810
P Mole ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-01 BALANCE B/d 2200 May-16 cash book 1600
May-16 discount received 110
2200 2200
31-May balance c/d 490

F LANE ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-01 BALANCE B/d 2100 May-16 cash book 3200
May-03 sales 1170 May-16 discount received 160
May-31 balance c/f 510
3870 3870
Jun-01 BALANCE B/d 510
J WILSON ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-03 sales 2020 May-11 sales returns 370
May-16 cash book 880
May-16 discount received 44
2020 2020
31-May balance c/f 726
T COLE ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-03 sales 1840 May-31 balance c/f 2320
May-09 sales 1280
3120 3120
Jun-01 balance b/d 2320
F Seema ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-03 sales 2380 May-11 sales returns 310
May-16 cash book 1470

May-16 discount received 73.5
2380 2380
31-May balance c/f 526.5
J ALLEN ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-03 sales 990 May-31 balance c/f 990
990 990
Jun-01 balance b/d 990
P WHITE ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-03 sales 2820 May-31 balance c/f 2820
2820 2820
Jun-01 balance b/d 2820
J FOX ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-09 sales 2310 May-31 balance c/f 2310
2310 2310
Jun-01 balance b/d 2310

SALES ACCOUNT

DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 balance c/f 14810 May-31 sales day book 14810
14810 14810
Jun-01 balance b/d 14810
PURCHASES ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 Purchases day book 18410 May-31 balance c/f 18410
18410 18410
Jun-01 balance b/d 18410
SALES RETURNS ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 Sales returns day book 680 May-31 balance c/f 680
680 680
Jun-01 balance b/d 680
PURCHASES RETURNS ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 balance c/f 110 May-31 purchases returns day book 110
110 110
Jun-01 balance b/d 110
STORAGE COSTS ACCOUNT

DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-01 cash book 800 May-31 balance c/f 800
800 800
Jun-01 balance b/d 800
MOTOR EXPENSES ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-04 cash book 670 May-31 balance c/f 670
670 670
Jun-01 balance b/d 670
DRAWINGS ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-07 cash book 2000 May-31 balance c/f 2000
2000 2000
Jun-01 balance b/d 2000
DISCOUNT ALLOWED ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 cash book 387.5 May-31 balance c/f 387.5
387.5 387.5
Jun-01 balance b/d 387.5
DISCOUNT RECEIVED ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £

May-31 balance c/f 2135 May-31 cash book 2135
2135 2135
Jun-01 balance b/d 2135
SALARIES ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-27 cash book 14500 May-31 balance c/f 14500
14500 14500
Jun-01 balance b/d 14500
BUSINESS RATES ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-30 cash book 2220 May-31 balance c/f 2220
2220 2220
Jun-01 balance b/d 2220
CAPITAL ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-31 balance c/f 366100 May-01 BALANCE B/d 366100
366100 366100
Jun-01 balance b/d 366100
PREMISES ACCOUNT

DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-01 BALANCE B/d 440000 May-31 balance c/f 440000
440000 440000
Jun-01 BALANCE B/d 440000
MOTOR VAN ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
Jul-18 BALANCE B/d 45250 May-31 balance c/f 45250
45250 45250
Jun-01 BALANCE B/d 45250
FIXTURES AND FITTINGS ACCOUNT
DATE 2017 DETAILS £ DATE 2017 DETAILS £
May-01 BALANCE B/d 10100 May-31 balance c/f 10100
10100 10100
Jun-01 BALANCE B/d 10100
CLIENT 2
Peter Doo Statement of Profit or loss for the year ended 31st July 2018

Particulars £ £ £
Sales
120000
0
less cost of sales
opening inventory 40500
add purchases 700000
740500
less closing inventory 42640 697860
Gross profit 502140
less Expenses
wages and salaries 165000
add amount accrued 1520 166520
motor expenses 45800
admin expenses 16500
heating and lightning 5500
advertising expenses 10300
less amount prepaid 4470 5830

depreciation on premises 5600
depreciation on equipment 19000
depreciation on motor vehicle 3600 28200 268350
Operating Profit 233790
Balance sheet Peter
Doo for the year ended
at 31st July, 2018
Particulars Amount (in £)
Current assets
Closing inventory 42640
Prepaid advertising 4470
Bills receivables 115200
cash in hand 3000
Total current assets 165310

Fixed assets
Freehold premises 280000
Less depreciation on premises: 5600 274400
Equipment 190000
Less: Depreciation on equipment 19000 171000
Motor Vehicles 30000
Less: Depreciation 3600 26400
Total fixed assets 471800
Total assets 637110
Liabilities
Accumulated 40000
68000
12000 120000
Current liabilities

Bills payables or creditors 56000
Outstanding salaries 1520
Bank overdraft 10000
Total current liabilities 67520
Capital 243800
Add: NP 233790
Less: Drawing 28000
Total shareholder’s capital 449590
Total liabilities or obligations 637110
CLIENT 3
Bowling Limited
statement of profit or
loss for the year ended
31st July 2018
Particulars
Amount
(in £)
Amount
(in £)
Amount
(in £)

Sales 107000
Less: Sales return 2000 105000
Inventory at the end of period 18000
Stock at the beginning of the year 17000
Purchases 32000
less: purchase return 0 32000
Cost of Goods sold (COGS) 31000
GP (Gross profit) 74000
Depreciation on building 10000
Depreciation on plant and machinery 10000
Administration expenses 28000
Expenses pertaining to distribution 22000
Less: Prepaid rent 3000
Add: Outstanding salaries 2000 21000

Corporation tax 4000
73000
NP (Net profit) 1000
statement of financial
position of Bowling Limited
as at 31st July 2018
ASSETS £ £
NON-CURRENT ASSETS
Land & buildings 60000
Less: accumulated depreciation 7000
Less: depreciation 10000 43000
Plant & machinery 65000
Less: accumulated depreciation 15000
Less: depreciation 10000 40000
Total fixed assets 83000
CURRENT ASSETS

Inventory 18000
Trade Receivables 24000
Prepayments 3000
Total current assets 45000
TOTAL ASSESTS 128000
EQUITY AND LIABILITIES
Equity
Share capital @ £1 each 50000
Share premium 20000
Retained Earnings 23000
Total Equity 93000
CURRENT LIABILITIES
Trade Payables 14000
bank overdraft 15000
Accruals 2000
tax payable 4000 35000

TOTAL EQUITY AND LIABILITIES 128000
C) Explaining concepts of consistency and prudence
Consistency concept-
The concept states that firm should deploy consistent method of accounting methods and policies so that it can be compared
with previous years. It is required as if consistent policies are not followed, comparison cannot be taken leading to decrease in
reliability.
Prudence concept-
The prudence concept works on simple principle that firm should anticipate for losses and not for profits. In simple words,
overestimate of profits must not be made and underestimate of losses as future is uncertain and thus, provision should be made.
D) Purpose of depreciation and methods of calculating depreciation
Depreciation is termed as decrease in value of asset which is done with a view to provide depreciation on tangible asset due to
its normal wear and tear, passage of time etc. Main purpose of charging depreciation is to ascertain correct profits by reducing asset
value, if not done, then asset will be overstated in books of accounts leading to wrong profits. Two methods of depreciation are-
Straight line method-
This method charges depreciation on asset year by year until its value becomes zero. Similar percentage is applied for useful
life of asset till it reaches zero (Nobes, 2014).
Written down value method-
The method is based on charging depreciation on reducing book value of asset for attaining depreciation.

CLIENT 4
Purpose of preparing bank reconciliation statement
Main purpose of preparing bank reconciliation statement is to compare bank records with that of book records of firm for
assessing differences if any between set of records for cash transactions. Thus, differences are analysed and corrected for matching
balance.
Explaining areas which cause record vary with bank records
The areas causing differences in book records and bank records are outstanding check, deposit in transit, check printing
charges, electronic charges on bank statements not yet recorded in books of accounts, bank service charges etc (Needles, Powers and
Crosson, 2013).
Preparing accounts through cash flow statement
Bank reconciliation statement
Bank Reconciliation Statement as at 31st December 2017
Details Cheque
no
In £
Balance as per bank statement 17478
Add: Outstanding lodgement 176
17654
Less: Un-presented cheques 737 1163
Balance as per cash book 16491
Updated cash book:
Updated cash book for the period ended on 31st December 2017

Dates Receipts Figures
(in £)
Dates Payments Figures
(in £)
31-Dec-
17
Balance b/d 19973 31st December 2017 Error
adjusted
1
Error adjusted 9 Bank
charges
47
Standing
order
137
Direct
debit
297
Balance
c/d
19500
19982 19982
Bank reconciliation statement:
Bank statement as at 31st December 2017
Details Cheque
no
In £
Balance as per bank statement 19738
Add: Outstanding lodgement 119
19857
Less: Un-presented cheques 97 357
Balance as per cash book as
at 31st December 2017
19500

CLIENT 5
A). Preparing control accounts
Sales ledger control account
Sales ledger Control account
Date Details Amount
(in £)
Date Details Amount
(in £)
1st Jan Balance
B/d
9600 1st Jan Sales
Returns
5320
Credit
Sales
142350 Payment
received
150610
Discount
Allowed
960
Bad
written
off
1200
Control
entry
540
1st Jan Balance
C/d
6680
Total 158630 Total 158630
31-Jan Balance
b/d
6680
Purchase ledger control accounts:
Purchase ledger Control account

Date Particulars Amount
(in £)
Date Particulars Amount
(in £)
01-
Jan
Return
outward
2110 01-
Jan
Balance
B/d
10160
Discount
received
550 Credit
Purchase
106500
Payment to
suppliers
111010 Refund
received
from
supplier
400
Contra
effect
540
Balance c/d 2850
117060 117060
31-
Jan
Balance
b/d
2850
B) Explaining need of preparation of control account
Control account is used to record balances on several subsidiary accounts and to make cross-check on them (Mulford and
Comiskey, 2011). Need of preparation of control account arises in large organisations where numerous transactions occur on daily
basis, thus, to make proper record of all, control account is prepared.
CLIENT 6
A) Meaning of suspense account and highlighting features
The suspense account is used to control flow of money when payment is received for which account to which such payment to
be recorded or directed is not known. Main features are-

 It is recorded for temporary basis
 It is cleared from suspense account as soon as nature of account is found.
B. Drafting a trail balance
Trial balance
Particulars Debit Credit
Purchase 700
Sales 1100
Rent paid 250
Cash at bank 840
Travel expense 160
Receivables 320
Payables 350
Capital 710
Opening inventories 220
330
Total 2490 2490
C Trial balance suspense account
Suspense account
Particulars Debit
(in £)
Particulars Credit
(in £)
Whites 750 Balance b/d 330
James 420
750 750
Trial balance after adjusting suspense figure

Particulars Debit Credit
Purchase 700
Sales 1100
Rent paid 250
Cash at bank 840
Travel expense 160
Receivables (330+
420)
750
Payables (350+750) 1100
Opening inventory 210
Capital 710
Total 2910 2910
D) Differentiate between suspense and clearing account
Clearing Account Suspense Account
Clearing account is zeroed out and not
prepared for temporary basis.
Suspense account is temporary holding account
in which amount is shifted because of its
unidentified nature.
In this, figures may or may not be of
transactional nature.
Figures included in this account are of
transactional nature.

While, clearing account is not prepared
because of ambiguity.
This is usually prepared for handling
uncertainties
CONCLUSION
By summing up the above report, it can be concluded that financial accounting plays a vital role in the success of an
organisation. Financial reporting is branch of reporting that helps is summarizing, recording, and analysing and presenting the
financial transaction and activity for the use of external users. The financial reporting are presented in form of financial statement like
income statement, balance sheet, cash flow statement etc. the present report has concluded the financial accounting and the purpose of
preparing it. The report has also analysed the different types regulations and standard relating to the financial accounting. There many
concepts and principles of financial accounting that are concluded in the report. The report has analysed the consistency and full
disclosure principles of accounting. Further, the report has concluded the calculations of the financial statements for different clients.