Accounting & Client Care Flashcards
What are the key financial statements that all companies must
provide?
The key financial statements to be provided by companies are Profit and loss
account, balance sheet and cash flow statement.
What is the difference between management and financial
accounts?
Management accounts are for the internal use of the management team. Financial accounts are the company accounts required by law.
What is the difference between a profit and loss account and a
balance sheet?
A profit and loss account shows the incomes and expenditures of a company and the resulting profit or loss.
The balance sheet shows what a company owns (assets) and what it owes (liabilities) at a given point in time.
What is a cashflow statement?
summary of the actual or anticipated ingoing and outgoing of cash in a firm
over the accounting period.
What is the purpose of a P & L?
1) Monitor and measure profit (or loss). Significant problems can arise if the
information is inaccurate, either through incompetence or deliberate fraud.
2) Compared to its past performance, compared to the budget and compared to
other businesses.
3) Assist in forecasting future performance (next periods budget).
4) Calculate Tax
Why do chartered quantity surveyors need to understand and be able
to interpret company accounts?
For own business accounts.
For assessing the financial strength of contractors and those tendering for contracts.
For assessing competition.
What is the difference between debtors and creditors?
Creditors - Your firm owes another firm money - e.g. If you owe a sub-consultant fees then they are a creditor.
Debtors - A firm who owes your firm money - e.g. a client who owes you fees is a
debtor.
What are Financial Statements used for?
Forecasts of income and expenditure can be used as an analytical tool to identify potential shortfalls and surpluses.
What are Profit and Loss used for?
Shows company sales, running costs and profit / loss over financial year. Used to show sales vs expense (invoicing vs time and disbursements). Can be used to identify nonprofitable
work.
What is a Balance Sheet used for?
Shows the value of everything the company owns, owes and is owed.
Shows the value of the business at any given point.
Useful for investors.
What is a Cashflow used for?
Summarises amount of cash or cash equivalents entering and leaving a company.
Used in CA projects and is shown as a ‘S’ curve. Small financial outlay at the start, steep increase during and tapers off at the end.
What is an LLP?
In a Traditional Partnership - Joint liability - all Partners accountable for another’s mistake.
LLP - technically they are ‘Members’ of the LLP and not ‘Partners’
Provides additional protection through limited liability. Only liable for your own negligence/default etc.
Governed by the Limited Liability Partnership Regulations 2001
What does client care mean to you?
Looking after client’s best interests and providing an appropriate service.
Why is client care important?
RICS members are required to provide a high level of service.
Providing a high level of service is likely to mean retaining clients & have positive testimonials.
Bad client care will lead to dissatisfaction, lost clients, complaints and potential PII claims which can be costly and time consuming.
What did you learn about good client care in your CPD training?
To provide a good level of client care you need to have a good understanding of the client’s requirements and expectations
