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Flashcards in Accounting Principles Deck (6)
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1

What would you expect to find in a set of Public Limited Accounts

Chairman’s statement
Independent auditors report
Income statement (profit and loss account)
Statement of financial position (balance sheet)
Corporate governance report
Remuneration report
Other statutory information

2

What’s a profit and loss statement?

Same as an income statement

A summary of the business’s income and expenditure prepared usually on an annual basis

3

What is a balance sheet?

Same as a Statement of financial position.
It shows a businesses assets and liabilities at a given date (end of the financial year)

4

What is considered an asset and a liability

Assets:
Cash
Property
Debtors
Other investments
(Rental income from leases)

Liabilities:
Borrowings
Overdrafts
Loans
Creditors

5

What’s the difference between audited accounts, management accounts and a consolidated set of accounts?

Audited accounts are prepared by a chartered or certified accountant

Management accounts are prepared for internal use my a business and are not audited

Consolidated set of accounts comprise a number of individual subsidiary accounts for a company within a single set of accounts

6

What is a cash flow statement?

A cashflow statement shows all the actual receipts and expenditure to include VAT.
It is not included in the annual accounts.