ACCT 001 Lecture Notes - Lecture 2: Cash Flow Statement, Accrual, Financial Statement

• School: College of The Sequoias
• Department: Accounting (ACCT)
• Course: ACCT 001
• Professor: skaff

Document Summary

Two main groups are responsible: managers are responsible for issuing accounting and controlling its financial affairs. The fundamental conflict of interest has led to the development of auditing: accountants have the job of shaping the financial statements by applying the principles of accounting to the enterprise"s records. Auditors enhance the credibility of the enterprise"s financial statements through providing opinions about its fairness and appropriateness. External auditors: report on the financial statements on behalf of external users. Internal auditors: work within the enterprise to support the credibility of information. External auditors are not permitted to be an owner or manager of the enterprise and can"t own shares in the company. Accrual accounting: income statement that reports revenues and expenses (records revenues and expenses at the time they occur) Cash accounting: cash flow statement that reports cash inflows and outflows (record revenues and expenses at the time the cash is received or paid)