Analyzing The Financial Condition and Health of The Company

BUSINESS REPORT

(a) Concept of Financial accounting

In every organization, it is necessary for them are organize sufficient amount of capital for the purpose of planning their future projects in effective manner. In this process, managers need to organize capital from various sources. Financial accounting is said to be appropriate art of recording, dividing and evaluating in important way in respect to capital, transaction and activity that are done within an organization. It is also considering as reliable branch of accounting that used to provide right direction to a company’s financial transaction by recording, summarizing and present in financial report. Some of them are profit and loss statements, balance sheet and cash flow statements (Francis, Hasan and Wu, 2013). Most of the company used to release its financial statements on continuous basis.

The statements are taken into consideration as external because they used to provide specific information to the people from outside the company. It is necessary to point out the valuable purpose of financial accounting that is not reported as value of the company. In-spite of their objective which is provided for other to assess the interest of an organization. These financial report is being done with the aim of attaining specific aims that are set by the company. there are some crucial firms those are using various accounting systems by using IFRS standards. Financial accounting is considering as one of the effective aspects which will be considered for attaining maximum return in near future. Financial report are being taken into account in order to keep all the standard and responsibility of manager and accountant. Some of the vital statement those are used in financial accounting purpose are mentioned underneath:

Profit and loss statements: It is known as one of the effective report that is being prepared by the accountant by summarizing the revenue, cost and expenditure of the company incurred during the time. It would indicate total earning and expenses in the mentioned period of time, usually a fiscal year. It will assist companies in analyzing, whether the company is making appropriate revenue, income statements of an organization (Edwards, 2013).

Balance sheet: It would be happening as one of the crucial statements that is being used as particular data those are done by the company during the time. It is considering as company’s main statements which would provide overall health position as well as liquidity state. Financial firms and other stakeholder used to present specific data about assets and liability of the company. This seems to be effective financial statements for delivery available loans and investment done in an accounting period.

Cash flow statement: It seems to taken into account valuable information about all cash inflows and outflows that are incurred during the time. These amounts are collected from various activity such as operating, investing and financing. These are prepared to make evaluation of whether company is having sufficient amount of capital to make future investment in near project.

(b) Regulation related with financial accounting

Financial accounting board is considering as one of the private, non-private business standard imposing bodies that primary aim is to establish better outcomes to the company. The required needs rules and regulations which would assist in formulating financial statements in essential manner for various reasons. Such as to ensure that requirement of users of financial records must be met with at least a simple data that are prepare by the company within an accounting period of time (Beatty and Liao, 2014). There are not any other issues required by the company in order to report various activities that are necessary for making sustainable demand of the company. present reporting and practices are having more link with future growth and financial balance of an organization. Although, financial reports are reliable for making comparison of company’s performance on the basis of last year condition. The financial information parties are large enough and having diversified impacts as per the financial accounting. In case of any modification change in the data those are required as an individual for plenty of ways. In order to maintain appropriate rules and regulation that are based on certain norms such as IASB. The main motive of IASC which was used to promote global consistency among financial statements which would prepared through company at national level. It does not have to force by law because, every information that are mentioned under the report are based on certain polices and rules. These standard are considered while recording of various transaction into different statements.

C) Principles and regulations used in accounting

In accordance with various transactions that are done within an accounting period of time, accounts are using various rules and regulations that are utilized or proposed through using various guidelines that are required to be taken into account while recording of data into the statements. It has been observed that there are various types of rules and concept which will be use by manger while recording or posting of any kind of financial transactions. In case of using accounting records, detailed regulations and laws that are being use by FASB (Barron, Chung and Yong, 2016). It has been found that some of the effective distributes its financial records to public and required to make impacts on GAAP principles during the time of developing their reports. Likewise, in accordance with company’s overall inventory which is public traded and need as financial record through audited through an appropriate accounting skills. Some of the valuable principles are mentioned underneath:

• Cost principles: According to this accounting norms, it has been known as that cost which would be based on historical cost aspects. It required that all assets must be recorded only at cash basis during the time of acquisition.
• Going concern principle: The seems to be assumptions that every entity would remain as effective business for specific aspects for foreseeable future. As business would continuous for longer period of time.
• Full disclosure principle: It is said to be vital information that would be made by stakeholders by using financial report which data will be disclosure during prepared data. This seems to be primary aim of manager to provide all essential data which are mentioned under different reports. It is needed for every organization to make future planning by using various data of the company in reliable and accurate manner.

Rules and regulations:

There are various types of accounting rules which will be taken into consideration while recording of essential transactions. Some of them are discussed underneath:

• Personal account: It is said to be one of the reliable account that will be taken into account as an individual as per the demand of the company. The accounting rules said that Debit all receivers and credit the giver. Few examples are, drawings and capital etc.
• Real account: Under this account that is related with the nature of assets which will be used by the firms (Weygandt, Kimmel and Kieso, 2015). According to this rules, debit all the amount which is coming inside the company, while credit all of them that are goes outside. Like cash.
• Nominal account: It seems to be essential financial transactions those are done during the period of time. In this rules, debit all expenses or losses and credit all the income and gains.

(d) Various convention and concept of materiality and consistency

In finance term, accounting conventions would be considering as one of the common aspects that would be considers with the recording of every business entry. It would be considered as one of the effective norms which will be not a definitive guideline in overall accounting rules that are govern as one of the specific condition. Convention in accounting that has been associated with bring regarding uniformity in the overall maintenances of accounts statements. This would be consider as commonly accepted convention which would be customs and framed to assist accountants to reduce practical issues those are arises out of preparation of financial records. This would be reliable in case of any critical situation that is not related with any kind of rules and standard which are governed during an accounting period. There are different types of profitable aspects which will be considered by an organization. Some of them are discussed below:

Consistency: In financial accounting, convention of regularity principles which would be same accounting that should be considered for formulating financial transaction over the period of time (Hillier, Grinblatt and Titman, 2011). Any modification can be considering as valuable examples which will be taken into account for evaluating strength and weakness of the company.

Materiality: It would be considered as effective convention that can be considered for making analyzing of impacts that are used by users in proper decision making. Financial account items are taken into account as material if they would influence economic decision in proper ways.

Concept: Accounting managers need to follow certain amount of concept which would be helpful while recording of various transactions into the books of account. Some of them vital concepts are explained below:

• Money measurement: It is said to be one of the effective and easy concept which will be taken as guide for business by the managers. Every recording of events or transactions can be analyses in terms of money. It is mainly measures in terms of local currency.
• Conservatism: As per this principle which is helpful for the company in recognizing expenses and debts as early as possible in case of uncertainty regarding the results. It is also said be prudence which is a policy use for anticipating best possible outcomes in near future period of time. The policy tends to understands various aspects of net assets and incomes incurred by the company.

P1 Information regarding double-entry bookkeeping

Financial accounting is considered as one of the primary aspects for the company. Each financial or non-financial transactions those are done by the company will be recorded with the help of using double entry bookkeeping. It is said to be crucial term that means that all transaction affects mainly two books of account of an organization. Double entry is said to be one of the reliable accounts that must have entered as debit balance and another one is recorded with credit (Christensen and Nikolaev, 2013). The major benefit of using this statements is that company overall assets will be equal to debt balance. The Fundamental reason for underlying effects need to be recorded as day to day bookkeeping and other detail related with accounting transaction in two different accounts.

Ledger posting

This seems to be more vital process which will be done in order to record every effective financial transaction into different statements. It is known as second step after the recording of journal entries. It is considering as primary sources of data keeping by the internal manager of an organization. These are done to separately analyze all implication as well as division of amount in various reports. A ledger is main accounting areas that is held responsible for measuring total amount which is available with the company to make future planning in coming projects. After completing all the vital analysis, investors or other shareholder would be able to make their valuable capital investment decision. On the basis of this, company can easy examine total reaction or current position of an organization to make future planning of growth.

P2 Concept of trail balance and its balancing measure

Trail balance is one of the effective accounting workbook statement in which every balancing amount recorded into ledger are used for the purpose of preparing other crucial statements. By designing such kind of ledger account, manager would be able to determine that debits and credit column must be equal to them. A company used to formulate a trail balance that is periodically considered at the closing of every accounting period of time. It means that trail balance will be not important for recording of transaction for bookkeeping (Chen, Li and Wang, 2011). It is prepared after preparation of various entries those are recorded into journal books and ledger. This seems to be valuable for profitable company to formulate such financial accounts that is related with the purpose of determine all errors those are occurs in the transaction. Recording of financial transaction is said to be common statements that can assist them to attain more reliable outcomes in coming period of time. The transaction of trail balance needed to initially determine errors that are made while recording of financial data with the aim of make comparison of debit and credit column. If you provide the best essay writing service. Chat Now!

CLIENT 2

P3 (a): Formulation of financial account and related trail balance

(b): Financial statements of peter piper

CLIENT 3

P4 Formulation of financial statements and a wide number of examples

It has been found that financial manager would be able to make use of various accounting concepts which will be helpful for recording of various types of accounting transactions. It is basically known as accounting rules that would be taken into account for preparing the financial statements in effective manner. Some of them are discussed underneath:

Consistency concept: It is known as appropriate concept that is being taken into account as one of the appropriate accounting method that has been selected by the company. It is done so because they think that business would be not operate for short time period, it is continuous process. This means that recording of financial transaction must be recorded in effective or accurate manner unless, managers do have sold reason to go for specific modification. In case few financial transactions those are occurred will be recorded by using correct standards and rules that attempt to examine inconsistent information those are collected by the managers during the period of time (Nobes, 2014).

Prudency concept: According to this particular concept, all the revenue and profits must be recorded in the main account such as balance sheet only in case they are realized at that time. A company must be conservative while recording of assets amounts and does not underestimate debts. The outcomes would be conservatively related with the financial statements of the company. It is said to be conservatism aspects in which an accounting principles those are needed by an accountant to keep all liabilities and expenditure at the time they occurred. In case of any losses or liabilities those are recorded into financial records of an organization must occurred during the period of time.

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P5 Bank Reconciliation process

BRS is considered as one of the effective statements which will be prepared by every account keeper on specific date to reconcile the bank balance as per the cash book to that with bank statements. In case any difference indicating in them would be making huge impacts on those two balances. Formulation of bank reconciliation statements that is not considered as effective part of double entry book keeping. It is an appropriate method to make reconcile bank balance in cash book with the overall balance as per the provided bank statement or pass books. A Bank reconciliation is used to make comparison among the cash position records an overall change to the book balance to account for financial transaction that are mentioned on the banks records. There is certain accounting transaction that are examine with the motive of using Bank reconciliation statements (Bhattacharyya, 2012). Some vital matter that are expressed in terms of account are taken into account such as:

• Every deposit done into the bank and cannot be credited from bank side. Like, as this is associated with cheques which is sent to the bank for the purpose of raising capital.
• Evaluate various records those are mentioned into the bank statements, while recording at any point of transaction.

Issues related with bank reconciliation:

There is various vital reason for analyzing difference in bank account balance that is being revealed through cash books and pass book. It can be considered that nothing would be more to do with other aspects that are used by managers. In different organization, it would be reconciling by an individual that are not related with cash payment or other operations.

CLIENT 4

BRS statements as one 1^stDecember, 2017

P6 Procedure of Reconcile control account

(a): Control account

This seems to be one of the effective account that is summarise all account that is consider for general ledger. The detail must be supported as appropriate balance in entire evaluation of account that consists of subsidiary ledger description. Every account must be used to record all the business statements as per the balance on total number of statements and used to provide a cross-check on continuous basis (Gassen, 2015). Get the best assignment help at an affordable budget.

CLIENT 5

(a) Main feature of suspense account

It has been seen that few of the primary aspect that is being recorded into the account like suspense accounts (Ryder, Elaine G. Ryder, 2012). To determine various transactions that used to correct as appropriate balance and incorrect recording of statements. It is utilising because of proper account that should not be analyse at the time when those transactions are arises.

b) Trial balance (£)

Particular	Debit amount	Credit amount
Suspense a/c		110
Sales		1100
Rent paid	250
Receivables	320
Travel Expenses	160
Purchase	700
Payables		350
Cash at bank	840
Capital		710
Total	2270	2270

(c) suspense account

	Suspense account
Particulars	Amount	Particulars	Amount
To White's personal account	750	By balance b/d	330
		By John's personal account	420
	750		750

(d): Comparison

Suspense account	Clearing account
It is taken into account in case company found any kind of problem while recording of transactions.	It is common account, but it does not used for posting of financial statements.
It is said to be cleared once errors are detected in the statements.	This seems to provide clear picture of lying unreconciled amount in the business.

CONCLUSION

From the above project report, it has been concluded that financial accounting is one of the reliable aspects which will assist organisation to manager their resources in effective manner. For this purpose, various types of rules and regulations those are useful for them are taken into consideration. All conventions and concept of accounting that utilise for recording of various financial transaction are used positively in the above journal entries and ledger posting statements. Further, this report guides the manager about various accounting statements those are providing reliable outcomes to the company in near future time.