Creative accounting, also known as earnings management or cooking the books, is legal but can be misleading to investors. Companies use it to emphasize positive financial aspects while downplaying negative ones. It can increase share value, but regulations are being implemented to prevent deceptive practices. Creative accounting is a description of accounting practices that are […]
Government accounting uses funds to represent capital appropriated for specific uses. Accountants must appropriate funds according to predetermined budgets, and appropriations must be used for their specific purpose. A lien allows the agency or municipality to pay for assets using an accounts receivable system. Budget accounting is one of the most widely used accounting by […]
IFRS accounting requires accurate and honest financial reporting to help investors make informed decisions. Balance sheets, statements of comprehensive income, and cash flow statements must be prepared in accordance with IFRS standards, with clear classifications and notes. These reports provide information about a company’s financial status, income, and cash flow, allowing investors to assess its […]
Restaurant accounting tracks money coming in and going out, including from dining and bar sales, suppliers, bills, and employees. Outsourcing to specialized firms can save time and money, while detailed accounting can help identify profitable areas and guide menu and promotion changes. Proper documentation can help resolve payment issues and reduce internal theft. You should […]
Pro forma accounting uses historical data to create financial forecasts, helping businesses make informed decisions about expansion projects. Accurate data is crucial for reliable projections. Pro forma accounting is a type of financial strategy that incorporates forecast and historical information when preparing various types of accounting reports. The idea is to use this approach to […]
Financial accounting involves creating and issuing financial statements, which summarize a company’s activities and are used by stakeholders to assess its financial value. The statements include a balance sheet, income statement, cash flow report, and owners’ equity statement, and are audited by independent accountants. Financial accountants must have skills in data manipulation and analysis software. […]
Trustees must keep accurate financial records when managing a trust or estate. The records must include the principal and income, any gains or losses, and all payments made. Once prepared, the statements are distributed to interested parties and can be used to distribute income and assets. A trustee is someone who is in a position […]
Quantitative accounting uses existing monetary values to derive other values, without predicting or detecting trends. It emerged in the 1990s as a way to maintain economic stability, but excessive analysis of simple data contributed to the 2008 global recession. The field focuses on finding correlative information, and differs from quantitative economics in that it does […]
An accounting information system is a method of maintaining financial records. The accounting cycle includes identifying transactions, creating journal entries, preparing financial statements, and generating a final trial balance. Accounting software packages have modules for different accounting processes, and computerized systems improve accuracy and timeliness. Hybrid systems allow for manual review and internal controls. An […]
Accounting specialists process accounts payable and receivable, manage ledger accounts, enter invoices into payment systems, and reconcile payments. They must be experienced in accounting, payment processing, and have computer skills. Accounting professionals are an integral part of a company’s finance and accounting departments. The individual in the role of Accounting Specialist will have the responsibility […]
Fixed asset accounting tracks the value and changes of items a business uses for operations. Companies have internal guidelines for recording fixed assets, including a dollar limit for treating an item as an asset. Accountants must value assets at book or market value and determine if they are depreciable. The department is also responsible for […]
To become an accounting teacher, you need a bachelor’s degree in accounting, a master’s degree, and possibly a doctorate. A solid foundation in accounting is necessary, and some institutions require a doctorate for tenured positions. A research component is also required for a doctorate. To teach others accounting as an accounting teacher, you will typically […]
When choosing a mobile accounting service, consider the contract terms, costs, and qualifications. Ensure the company offers guarantees of accuracy and efficiency, and ask for recommendations. Accounting services offer different packages, and it’s important to be aware of any additional costs. Ask about travel expenses, flexibility in appointments, and the qualifications of the employee performing […]
Accounting records, including invoices and payment receipts, are essential for tracking financial transactions and maintaining accurate ledgers. They are necessary for tax purposes and can be kept manually or electronically using accounting software. An accounting record is any type of electronic or printed document that provides information about the financial status of an individual or […]
To earn an accounting certification, one must complete post-secondary education, gain accounting experience, pay membership dues, and pass the certification exam. The American Institute of Professional Bookkeepers offers a certificate to provide assurance to employers. The exam has four parts, and exam preparation seminars are available. There are four steps required to earn an accounting […]
Fund accounting is a financial record-keeping system that focuses on accountability rather than profitability, highlighting where money comes from and how it is spent. It is commonly used by nonprofit groups and government agencies to track funds with specific purposes and regulations. This system provides clarity, helps with budgeting, and reveals an organization’s financial health. […]
Payroll accounting manages a company’s payroll information, including employee salaries, bonuses, and taxes. Accurate employment records are necessary to comply with legal requirements, and payroll accounting is often separate from regular bookkeeping. Accountants review entries and remit payroll taxes to the government agency. Payroll accounting is a process that occurs in all businesses and focuses […]
IFRS accounting standards require the acquisition method to be used for business combinations, recognizing assets and liabilities at fair market value, measuring consideration offered, and determining goodwill. Non-controlling interests must also be recognized. The protocol for reporting business combinations determines how an acquiring company recognizes the assets, liabilities, and non-controlling interests associated with the company […]
Nonprofits need to understand local accounting regulations and build an accounting system that meets them. Tax exemption can increase funds, but requirements vary by region. Good record keeping and knowledge of tax requirements are important. Nonprofit accounting software differs from for-profit software. Running a successful nonprofit requires a solid understanding of your organization’s specific location […]
Accrual accounting measures a company’s position and performance by recognizing all economic events, not just cash transactions. It provides a more realistic snapshot of a business’s financial status, but can be complex and costly for small businesses. It is beneficial for businesses that sell or buy on credit or have continuous projects. Accrual accounting generates […]
