COMM 211 Lecture Notes - Lecture 1: Financial Statement, Income Statement, Accounts Payable
2 Dec 2017
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Document Summary
Accounting is the language used to communicate financial information for decision making. Financial accounting: external focus: investors, creditors, report on the entire organization (aggregate, historical, standards based: ifrs/gaap ex. Management accounting: internal focus: management, employees, inform local decisions, pieces of the organization, current, future oriented ex. Relevant: useful to the decision maker predictive value; confirmatory value, material. Assume the firm will exist for many years: historical cost. Assets and liabilities measures at their cost when acquired: conservatism. When doubt exists, choose the value that results in lower income and/or assets. Use the same accounting policies & choices each period: matching. Link revenues and expenses together each period: full disclosure. 1. 2 financial statement introduction & statement of. Financial statements provide information about the financial position, financial performance and cash flows of an entity that is useful to a wide range of users in making economic decisions: users include investors, creditors, managers, educators, donors, etc.
