This essay Financial Accounting has a total of 7527 words and 56 pages.
Tasks Page No
Stakeholders 4Internal and external stakeholders interested in the business 4Why should I keep records? 5-6The Importance of Keeping Accurate Accounts 5-6Reasons for keeping accurate records of your income and expenses 6Books Of Original Entry 7Purchases Day Book 7Sales Day Book 7Sales Returns Day Book 7Ledgers 8The sales ledger 8The Purchases Ledger 8General/Nominal Ledger 8Cash-Books 8The Trail Balance 8Trading, Profit And Loss Account 9Trading account 9The Profit And Lost Appropriation Account 9-10Balance Sheet 10The accounts used by different types of organisation 10Sole Trader 11 Final Account For Sole Trader 11Trading, Profit And Loss Account For Sole Trader 11-12Balance Sheet For Sole Trader 12-13Partnership 14Final Account For Partnership 14Trading, Profit And Loss Account For Partnership 14-15Balance Sheet For Partnership 15Limited Company 15-16Final Account For Limited Company 16-17Trading, Profit And Loss Account 16-17Balance Sheet For Limited Company 17-18Non Profit Making Organisations 18Final Account For Non Profit Making Organisations 18Trading, Account For Non Profit Making Organisations 18The Income And Expenditure Account 18Benefits Of Computerised Accounting 19Types Of Accounting Packages 19-20Computerised Running Balance Accounts 20Computers And Accounts 20Examples of benefits of computers 21Differences Between Manual and Computerized Accounting 21Appendix 1 22Appendix 2 23Appendix 3 24Appendix 4 25Appendix 4 Continue 26Appendix 5 27Appendix 6 28Appendix 7 29Appendix 8 30Appendix 8 Continue 31Appendix 9 32Appendix 9 Continue 33Appendix 10 34Appendix 10 Continue 35 Stakeholders
Stakeholders are people who are affected by or are able to influence the behaviour of business organisations, the original stakeholders are the owners of the business they have a financial stake in, and seek profit from, the organisation. But there are other stakeholders as well and we can divide stakeholders as internal and external stakeholder.
Internal and external stakeholders interested in the business
The following stakeholders are internally involved in the business:
Owners/shareholders – interested in whether the business is making a profit – to receive dividends, state of financial affairs, financial structure, future prospects.
Managers – involved and interested with the performance of the business, also concerned about the financial structure and information relating to their to make decisions.
Employees – concerned about with their job security and how the business is going to develop to ascertain themselves for promotion needs, also financial structure to support wage claims.
The following stakeholders are externally involved outside the business:
Brokers – require the same sort of interest as owners, but brokers advise clients about the nature of their investments. Need to know company performance in order to advise clients accurately.
Lenders – interested in whether the business as the ability to pay interest and make repayments on the loans. Therefore interested in the cash flow statement, assets and ability to pay debts.
Customers – interested to know suppliers are secure for the future so customers will want to develop long term trading. Therefore also interested I the size of the business, profits and financial information.
Community – can be interested in the business providing jobs for the community and contributing to community projects. Community also interested whether business activity is affecting the communities environment.
Competitors – will be interested in the financial information which can be freely obtained if PLC so the competitors can stay one-step ahead. Other information maybe published in the press, looking at activities of competitors to think ahead.
Suppliers – concerned about the businesses ability to pay for materials or services. If pay off materials quickly suppliers can be committed for long term trading for the business.
Why should I keep records?
Record keeping is usually one of the tasks that people do not like to deal with. However, record keeping is very important to your business. The tax law covering business record keeping is complicated. Everyone in business must keep records. Good records will help you do the following:
o Monitor the progress of your business
· Prepare your financial statements
o Identify source of receipts
o Keep track of deductible expenses
o Prepare your tax returns
o Support items reported on tax returns
Make a profit. You need to know how much you are spending on your business to keep it running in order to know how much income you need to have a profit. For example: "How much do I need to sell my widgets for?" Always keep good records of the costs of taking your widget to market. You can then
Topics Related to Financial Accounting
Generally Accepted Accounting Principles, Financial statements, Balance sheet, Bookkeeping, Final accounts, Account, Financial accounting, Income statement, Debits and credits, Retained earnings, Net profit, Equity
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