Accounting Principals & Procedures Flashcards
(11 cards)
What is a balance sheet?
- Statement of financial position
- Shows assets and liabilities at a given date, usually at end of a financial year
- Assets = cash, property, debtors and other investments held
- Liabilities = creditors, borrowings, overdrafts and loans
What is a profit and loss account?
- Income statement
- A summary of a business’s income and expenditure transactions, usually prepared on an annual basis
What is a cashflow statement?
Shows all the actual receipts and expenditure to include VAT
What is a cashflow forecast?
- Used to predict the movement of cash in and out of their accounts over a specific period, usually a year
- It helps businesses understand their future cash position, identify potential liquidity problems, and make informed financial decisions
What is Net Yield?
A measure of an investment’s profitability after all associated costs have been deducted, typically expressed as a percentage of the asset’s value
What is Return on Investment (ROI)
A performance measure that evaluates the profitability of an investment in relation to its cost
What is a sensitivity analysis?
Used to assess how changes in key assumptions or inputs affect the outcome of a property investment, such as its projected profitability or value
What is the International Financial Reporting Standards?
IFRS 16
* The lease accounting standard that all companies have to comply with when using the International Financial Reporting Standards in respect of reporting property liabilities
* The full cost of a lease has to be accounted for on the balance sheet
What is a SWOT analysis?
A strategic planning tool used to assess an organization’s internal Strengths and Weaknesses, as well as external Opportunities and Threats
What is a business model?
A framework that outlines how a company creates, delivers, and captures value for its customers and itself
What is a payback period?
The time it takes for an investment to recover its initial outlay
