100% tevredenheidsgarantie Direct beschikbaar na betaling Zowel online als in PDF Je zit nergens aan vast
logo-home
Summary: Corporate Financial Reporting €4,48   In winkelwagen

Samenvatting

Summary: Corporate Financial Reporting

 9 keer bekeken  1 keer verkocht

This is a summary of the course Corporate Financial Reporting

Voorbeeld 3 van de 23  pagina's

  • 8 oktober 2024
  • 23
  • 2024/2025
  • Samenvatting
Alle documenten voor dit vak (1)
avatar-seller
joesvanderstok
Summary: Corporate Financial Reporting
2024

Revision material
Session 1 – Financial statements

Information to include in the most extensive reporting requirements:
1. Statement of Financial Performance -> income statement (IS) or profit &
loss (P&L)
= information on the net income of a business during a certain period
2. Statement of Financial Position (SOFP) -> balance sheet (BS)
= information on the financial condition of a business at a certain moment
3. Statement of Cash Flows
= information on the origin and use of cash in the company during a certain
period
4. Statement of Shareholders’ Equity
= information on the individual components of equity and the changes during the
year
5. Notes
= information on the criteria, principles, and norms used to prepare the financial
statements

Usefulness of Statement of Financial Performance
▪ evaluating the past performance of the company
▪ providing a basis for predicting future performance
▪ helping assess the risk or uncertainty of achieving future cash flows

Limitations of Statement of Financial Performance
▪ companies omit items that they cannot reliably measure from the income
statement
▪ income numbers are affected by the accounting methods employed
▪ income measurement involves judgment

Elements of the Income Statement (IS):
1. Income
-> Revenues = arise from ordinary activities of a company
-> Gains = other items that meet the definition of income and may or may not
arise in the ordinary activities of a company
2. Expenses
-> Expenses = arise from ordinary activities of a company
-> Losses = other items that meet the definition of expenses and may or may
not arise in the ordinary activities of a company

Revenue recognition = income generated through the sale of a product or a
service is recognized when ownership and control of the good are transferred to
the customer

Cost of goods sold (COGS) = costs directly incurred when producing the
product or service that is sold during the period

,Total comprehensive income = the change in equity during a period resulting
from transactions and other events, other than those changes resulting from
transactions with owners in their capacity as owners
-> = profit & loss + other comprehensive income

Usefulness of Statement of Financial Position
▪ assessing a company’s liquidity
▪ assessing a company’s solvency
▪ assessing a company’s financial flexibility

Limitations of Statement of Financial Position
▪ most assets and liabilities are reported at historical cost
▪ companies use judgments and estimates to determine many of the items
reported in the statement of financial position
▪ omission of many items that are of financial value but that a company cannot
record objectively

Asset = a present economic resource (potential to produce economic benefits)
controlled by the entity as a result of past events
Liability = a present obligation to transfer an economic resource as a result of
past events
Equity = the residual interest in the assets after deducting all liabilities

What counts as cash / cash equivalents?
- Cash
- Banks (accounts)
- Bonds about to mature (3 months or less)
-> any item that is highly liquid

Two ways to prepare the Statement of Cash Flows
1. Direct method (most common for entrepreneurs/small firms)
-> simply add up all the cash posts in the relevant categories
2. Indirect method (most common for medium/large firms)
-> five steps:
1. Obtain Balance Sheet of two consecutive years, Income Statement of the
current year, and selected transaction data
2. Compute differences in Balance Sheet
3. Transfer differences in Cash Flow format and incorporate selected Income
Statement and transaction data
4. Make sure net changes in cash match Balance Sheet change in Cash & Cash
equivalents
5. Comment on cash flows
Cash flows are classified in three categories:
1. Operating activities
= cash inflows and outflows directly related to earnings from normal operations
2. Investing activities
= cash inflows and outflows related to the acquisition or sale of productive
facilities and investments in the securities of other companies
3. Financing activities
= cash inflows and outflows related to external sources of financing for the

, enterprise




Session 2 – Accounting concepts and assumptions

Double-entry system = for every debit, there must be a credit
-> Assets = Liabilities + Equity

Accrual-basis accounting = transactions that change a company’s financial
statements are recorded in the periods in which the events occur (not when the
cash is received)

Matching principle = product costs should be recognized whenever the product
is sold
-> products costs: materials, labour, overhead
-> period costs: salaries, administrative costs (recognized as expense when
incurred)

Voordelen van het kopen van samenvattingen bij Stuvia op een rij:

Verzekerd van kwaliteit door reviews

Verzekerd van kwaliteit door reviews

Stuvia-klanten hebben meer dan 700.000 samenvattingen beoordeeld. Zo weet je zeker dat je de beste documenten koopt!

Snel en makkelijk kopen

Snel en makkelijk kopen

Je betaalt supersnel en eenmalig met iDeal, creditcard of Stuvia-tegoed voor de samenvatting. Zonder lidmaatschap.

Focus op de essentie

Focus op de essentie

Samenvattingen worden geschreven voor en door anderen. Daarom zijn de samenvattingen altijd betrouwbaar en actueel. Zo kom je snel tot de kern!

Veelgestelde vragen

Wat krijg ik als ik dit document koop?

Je krijgt een PDF, die direct beschikbaar is na je aankoop. Het gekochte document is altijd, overal en oneindig toegankelijk via je profiel.

Tevredenheidsgarantie: hoe werkt dat?

Onze tevredenheidsgarantie zorgt ervoor dat je altijd een studiedocument vindt dat goed bij je past. Je vult een formulier in en onze klantenservice regelt de rest.

Van wie koop ik deze samenvatting?

Stuvia is een marktplaats, je koop dit document dus niet van ons, maar van verkoper joesvanderstok. Stuvia faciliteert de betaling aan de verkoper.

Zit ik meteen vast aan een abonnement?

Nee, je koopt alleen deze samenvatting voor €4,48. Je zit daarna nergens aan vast.

Is Stuvia te vertrouwen?

4,6 sterren op Google & Trustpilot (+1000 reviews)

Afgelopen 30 dagen zijn er 83225 samenvattingen verkocht

Opgericht in 2010, al 14 jaar dé plek om samenvattingen te kopen

Start met verkopen
€4,48  1x  verkocht
  • (0)
  Kopen