Financial Accounting Report: Regulations and Client Account Analysis

This financial accounting report begins with an introduction to financial accounting, emphasizing its role in building strong capital structures and managing financial operations. It then delves into accounting regulations, principles, and frameworks, including GAAP, IFRS, and IASB. The report presents several client case studies, each involving the preparation of various financial statements such as journal entries, ledger accounts, trial balances, balance sheets, and bank reconciliation statements. It covers topics like income statements, financial position statements, and the purpose of depreciation. The report also addresses concepts like material disclosure, consistency, and the preparation of control accounts and suspense accounts. The report concludes with a discussion on different types of accounts used for framing reconciliation and methods of accounting. The report aims to provide a comprehensive understanding of financial accounting practices and their applications in real-world scenarios, offering valuable insights into financial analysis and reporting.

FINANCIAL
ACCOUNTING

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
A. Ascertaining the regulations relevant with accounting as discussed in report..................1
1 Financial accounting............................................................................................................2
2.Regulations relevant with financial accounting..................................................................2
3. Rule and regulations of accounting....................................................................................4
4. Concepts of material disclosure and consistency...............................................................5
b. Accounting measurements for portfolio clients.................................................................6
CLIENT 1........................................................................................................................................6
1. Preparing the book of prime entries for Alexandra Study..................................................6
2. Computing double entry recording with the help of ledger accounts................................9
3. Completion of each accounts with a contrast of drawing trial balance for 31st January 2018
..............................................................................................................................................17
M1 Ascertainment of several transactions compiled in Trial balance.................................18
D1 Records of all transactions in Trial balance....................................................................18
CLIENT 2......................................................................................................................................18
A. Drafting income statement for Peter Piper 31st December 2017....................................18
B. Preparing financial position statements for Peter Piper as on 31st December 2017.......19
CLIENT 3......................................................................................................................................20
A. Preparation of income statement for Raintree Ltd...........................................................20
B. Preparing balance sheet for Raintree Ltd as on 31st December 2017.............................21
C. Discussion over accounting concepts such as prudency and consistency.......................25
D. Purpose of formulating depreciation in accounting statements as well as calculating it with
various methods....................................................................................................................26
M2 Evaluating the P&L account, cash flow statement as well as balance sheet of firm.....26
D2 Construction of final accounts based on accurate information.......................................26
CLIENT 4......................................................................................................................................27
A. Ascertaining purpose and reasons behind preparing Bank Reconciliation Statement for
Kendal Ltd............................................................................................................................27

B. Explaining and listing various areas which causes verification of records in bank statement
..............................................................................................................................................27
C. Referencing the cash book with preparation of various accounts...................................27
M3 Not sufficient funds and process of preparing deposits in transit..................................28
D3 Drafting accurate BRS....................................................................................................28
CLIENT 5......................................................................................................................................29
A. Balancing and preparing books of accounts for Henderson as on January 2018............29
B. Explaining terms of preparing Control accounts.............................................................29
CLIENT 6......................................................................................................................................29
A. Explaining terms and features of preparing suspense accounts......................................29
B. Preparation of Trial balance on contrast with balance of control account.......................30
C. Preparation of Journal entries with contrast of trial balance failure................................30
D. Analysing the differences between Suspense account and Clearing account.................31
M4 Types of accounts for framing reconciliation................................................................31
D4 Providing appropriate methods of accounting................................................................31
CONCLUSION .............................................................................................................................31
REFERENCES..............................................................................................................................33

INTRODUCTION
Financial accounting is the technique which will be assistive and helpful to the firm in
terms of building the strong capital structure as well as suggesting suitable way to manage
financial operations in firm. In the present report there will be discussion based on various
accounting principles and regulatory framework of financial institutions which are facilitating
appropriate accounting methods. There will be preparation of various financial accounts which
will be prepared to resolve financial issues of all clients which are here for operative decision. It
comprises with several accounts such as journal entries, ledger accounts, trial balance accounts,
balance sheet, bank reconciliation statement and suspense accounts. Therefore, such preparation
of these accounts will have positive influences as per analysing financial issues and management
of operations.
A. Ascertaining the regulations relevant with accounting as discussed in report
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From: Junior Accountant
To: Line manager
Subject: Accounting regulations, rules and principles for better financial control in business
Sir,
On contrary with analysing the operational activities of entity. Therefore, in relation
with operating accounts in premises will need a proper framework and adequate techniques in
preparing them. Discussion will be based on various accounting principles as well as
operational tools which will help in improving business efficiencies. Ascertaining appropriate
rules and regulations will be assistive in building suitable financial environment. It highlights
the methods of preparing financial statements which brings the suitable information among the
users of such accounts (Singleton-Green, 2016).
The managerial professionals as well as accounting personnel will have an appropriate
knowledge relevant with expenditures and revenues in due period. It benefits the external users
such as shareholders which seek for the appropriate disclosure of the accounts and financial
statements. They are mainly attracted towards profitability of firm as well as capital structure in
terms of making capital payments. There is a need to have an appropriate disclosure for
Achieving suitable market value for better operational practices of accounts. This will be an
assistive tool which brings control over operations.
1 Financial accounting
These are the accounts which keep records of all transactions that will be helpful and
assistive to unit in terms of making suitable strategies for operational activities as well as
suggests techniques to reduce costs implied in such activities. Administration of all financial
transactions will be collected, analysed and summarised into final accounts. It enables
accounting personnel to have the most appropriate information relevant with accounting control
and management of operations (Pawlowski, Nalbantis and Coates, 2018).
Usefulness of these accounts is that it brings information relevant with financial
operations as well as uplifts business efficiency in due course. Require information by users
such as consumers, competitors, investors as well as legal authorities which in turn analyse
operational activities of firm and make necessary operational practices in due period.
2.Regulations relevant with financial accounting
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It comprises with various legal regulations which in turn approaches towards
preparation of financial accounts for better operational management. Demonstrating the
requirement of preparing the financial accounts in relation with communicating the information
among external users (Samreen, 2018). Therefore, influences of various legal authorities will
have effective control over operational practices as well as management of activities.
Main motive of implicating regulations in financial operation is that the accounting
professionals are bound to prepare statements which will be prepared with considering all legal
and authentic frameworks (Regulations in Financial Accounting, 2017). It consists all details
such as recording of transactions as well as reporting the same among users. It communicates
the financial health of a business among note only domestic but also gathers international
investors for capital funding. Moreover, there are some regulatory authorities which enforces a
business in preparation of fruitful financials disclosures such as:
Generally Accepted Accounting Principles (GAAP): This organisation developed the
principles and rules of recoding accounting transactions for the specific period. Preparation of
all rules and principles will be effective and adequate as per managing operational activities of a
firm. Concepts and principles used here are the best for funnelling accounting professionals in
terms of better financial control in organisation as well as management of operational activities
(Kouki, 2018). It ascertains proper recording of all transactions in various accounts with their
appropriate methods of recoding transactions.
International Financial Reporting Standards (IFRS): These are the standards which
consists of all information that will be useful to firm in terms of preparation of statements and
accounts that will be useful and appropriate in terms of communicating financial health of entity
among external users (Bloomfield and et.al, 2017). It enables the professionals in making
appropriate decision as well as developing plans and policies as per guiding the accounting
professionals or auditors to control operational activities in business. These are international
standards which comprises with all information and techniques to prepare financial statements
for business.
International Accounting Standard Board (IASB): In accordance with operational
activities and the operational framework of IASB are based providing the accounting standard
among all the organisation. Th motive is for upgrading the accounting and book-keeping in the
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operational predicates with proper considerations of all the relevant information (Busco and
Quattrone, 2018). There are rules and principle relevant with each statement and transaction to
be recorded in the authentic manner. It brings the uniformity in financial disclosure as well as
helps in making proper records of all transactions.
Financial Reporting Council (FRC): This is UK's personal financial reporting council
which insists that perpetration of financial statements as well as operational regulations
(Financial Reporting Council, 2018). Accessibility of this organisation is in UK and Ireland.
Therefore, it approaches that the financial disclosure in both translocations needed to be
authenticate and appropriate.
Financial Accounting Standard Board (FASB): The purpose of implicating this board
is for monitoring and managing the operational activities which will be effective and helpful as
per managing business operations (Constable and Kuasirikun, 2018). It improves the already
existed accounting standards which were being formulated by GAAP.
3. Rule and regulations of accounting
To manage transactions in various books and accounts which have an appropriate
records of all transactions. Regulations and rules incorporated with recording transactions in
various accounts will have effective control over operations of firm (Damodaran, 2016). These
are the principles which are generally offered by GAAP which insists that the all the
transactions are needed to be recorded properly in the books and have satisfactory analysis over
it. Moreover, there will be record of all transactions in accordance with accounting principles
such as:
Going concern principle: These principles comprised with the rule that the firm is
operating the current period or they have initiate business will have long-term operations.
Therefore, it will be treated as the continuously operating entity in world. Thus, the firm will
being never liquidate it will continue to have trade practices in environment.
Separate legal entity: This principle comprised with the statements and rule that a firm
will be treat as a separate individual other that its owners. Therefore, itself has the operational
activities. Revenue, expenditures apart from the personal capital and costs incurred by its
owners (Robson, Young and Power, 2017). Therefore, this principle authorities does not have
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any rights to use the revenue generated by firm in their personal use as they have to make
payment to the dividend holders and settlement of all accounts in right time.
Monetary unit: This concept insists rules that all disclosure of financial statements and
the amount listed in the final accounts needed to be converted into US dollars. Therefore, it will
be profitable and helpful as per communicating financial details of firm among international
user of such accounts (Beatty and Liao, 2014). Therefore, there will e rise in the capital revenue
of a business. This technique will have positive impacts among the investors in terms with
analysing financial health various businesses as per a uniform disclosure of accounts.
Time period: This rule insists that disclosure as well as financial audit of the business
will be based on periodical presentations (Accounting Principles, 2018). Moreover, it bounds
the accounting professionals and auditors of unit in terms of making periodical disclosure in
considerations with a financial year of a firm.
Cost Principles: Accounting is records of all financial transactions on which it can be
said that there will be use of various spendings such as cash or other cash equivalents.
Moreover, it can be said that all transactions are needed to be recorded in proper amounts over
such transactions.
Full Disclosure: This principle comprised with the preparation of financial statements
based on full disclosure of accountants. Therefore, it comprised with framework of accounting
disclosure is that all accounts are needed to be prepared properly and have records in all the
accounts (Bushman, 2014). Therefore, in relation with same it can be said that companies are
bound to make disclosure of accounts such as income statement, balance sheet, statement of
change in equity and cash flow statement.
4. Concepts of material disclosure and consistency
Material Disclosure: It considered that the all the materialistic informations are to be
added by the professional in the financial disclosure as well as preparation of accounts. Thus,
the unrealistic and immaterialist things are not needed to be added in the financial disclosure of
firm (Materiality Concept in Accounting, 2018). It is essential that business have implication of
all financial details and disclosure of accounts.
Consistency: Similarly, with the going concern concept of business it can be said that
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the firm is needed to have fruitful discoloured of accounts in consistent manner. Thus, it can be
said that there is needed to have records of transactions of regular basis and monthly at the time
of activity took place. It created\s the proper recoding of all transaction held in a period and
does not have any burden over professionals. In relation with auditing of accounts there will be
investigation over all accounts in periodical basis such as daily, weekly, monthly, quarterly and
yearly.
b. Accounting measurements for portfolio clients
CLIENT 1
1. Preparing the book of prime entries for Alexandra Study
There will be use of several accounting records and transactions which are needed to be
add in an initial account. Therefore, there will be preparation of all the transactional entries in
different books. All inflows and outflows in an accounting period will have fruitful records of
transactions (Macve, 2015). It consists of all entries such as Adjusting retirers, Compound
entries, Reversing entries etc. Thus, such records will be helpful to the professionals in terms of
developing suitable operational records which are later adjusted in various other accounts.
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2. Computing double entry recording with the help of ledger accounts
By considering operational activities of Sole proprietor Alexandra study as recorded in
trial balance of the firm. Therefore, there has been preparations of all various necessary accounts.
Thus, after preparation of journal entries in of the proposed company it can e said that there will
be use of such transactions in severely ledgers of the accounts (Singleton-Green, 2016).
Similarly, ledgers are being prepared by an organisation which is in turn will have effective
control over the operational practices as well as revenue generation of the firm. According to
journal entries in the books there will be preparation of ledger of all the nominal and real
accounts such as cash receivable, sales, purchase, creditors, debtors etc.
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