logo

Report on Financial Accounting Principles (DOC)

   

Added on  2020-06-03

18 Pages4394 Words120 Views
Financial AccountingPrinciples

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................11. MEANING OF FINANCIAL ACCOUNTING...........................................................................12. REGULATIONS RELATED TO FINANCIAL ACCOUNTING..............................................13. ACCOUNTING RULES AND PRINCIPLES............................................................................24. CONVENTIONS AND CONCEPTS RELATED TO CONSISTENCY AND MATERIALDISCLOSURE.................................................................................................................................3CLIENT 1........................................................................................................................................4(a) Books of prime entries......................................................................................................4(b) Ledger posting..................................................................................................................7Trial balance.........................................................................................................................15CLIENT 2......................................................................................................................................16(a) Profit and loss statement for Peter piper.........................................................................16(b) Financial Position Statements.........................................................................................17CONCLUSION..............................................................................................................................18REFERENCES..............................................................................................................................19

INTRODUCTIONFinancial accounting is a section in which all the financial and monetary records of anorganisation are kept in a systematic manner. It is used in financial reporting and important asmanager's perspective (Collier, 2015). This report defines the dynamics of accounting principles,financial and accounting standards. It also explains the legislations and regulations regardingfinancial accounting. Meaning of consistency and material and disclosure are also defined in thiscontext.1. MEANING OF FINANCIAL ACCOUNTINGTo operate the functions and operations of business large number of cash and financialresources are used. Various type of cash, non-cash transaction happened in normal businessoperations. Financial accounting is a system which help to retain financial and monetarytransactions properly (Kim and Zhang, 2016). Scope of finance and accounting has become vitaland essential subject to financial growth of organisation. Financial reporting and accountingmethods are used by managers to achieve competence in management and operations. Financial and accounting reporting helps financiers, investors, stakeholders and owners.There are certain rules and principles followed while preparing accounting and financialstatements. These rules are known as accounting standards and Generally Accepted AccountingPrinciples (GAAP). Cost principles, matching principles, disclosure of accounting policies, goingconcern, economy entity, reliability and relevance assumptions are considered in GAAP. Theserules and regulations are given by Financial Accounting Standards Board (FASB, Pronounced“Fas-bee”). It is a non-government authority which provides standards to business organisationto record the information and reporting structure (Awrey, 2012.). There are various type offinancial statements are made as per the principles and rules like income statement, financialposition statement, profit and loss statement, balance sheet, statement of stockholder's equity andfinancial reporting. 1

2. REGULATIONS RELATED TO FINANCIAL ACCOUNTING(Source: Generally Accepted Accounting Principles (GAAP), 2017)Financial reporting council (FRC) is made which work as an independent authority forcorporate reporting and governance. The chairman of this authority is elected by trade andindustry and the bank of England. Accounting Standard Boards (ASB) are made from theAccounting Standards Committee (ASC) in 1990. Guidelines are followed since the companiesact (1985) was made. ASC has the authority to set its own standards and principles in respect ofaccounting and financial reporting (Ramanna and Watts, 2012). Chairman and technical directorsremain the part of Accounting Standards board is one of the main authority which provides rulesand standards regarding. 3. ACCOUNTING RULES AND PRINCIPLESAccounting rules and regulations which are given by the Financial Reporting Standardsare followed by the organisation (Elzahar and Hussainey, 2012). These accounting standards areapplied on financial institutions and the organisation which deals in investment banking.2

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
FINANCIAL ACCOUNTING
|23
|7737
|49

Report on Concept of Financial Accounting
|7
|1582
|32

Financial Accounting Principles | Report
|41
|6450
|41

Financial Accounting and Regulatory Framework
|8
|3283
|438

Financial Accounting and Regulatory Framework
|8
|3035
|78

Explaining Earnings Management in Relation to Accounting Culture, Practices and Reporting Environment and Corporate Governance
|11
|3648
|318