Financial statements are the way management communicates with the outside world on the financial performance and financial position of a business. They paint a picture to the outside world of how a business has performed over time or the state of the businesses assets and liabilities at a particular position in time. Financial statements, of …
In business, credit sales have become the norm in modern-day transactions. However, cash flow is a very important factor in business. Sometimes you need the money a lot sooner than the agreed date of payment. This can happen for various reasons but most commonly it is market conditions that dictate the payment terms. Operating in …
Whether a business provides physical goods, services or a mixture of the two it will inevitably carry some types of inventory. These usually represent a major investment by a business and therefore understanding the different types and how to recognise is important. What is inventory? Inventory refers to the stocks and supplies of materials and …
Management accounting looks a very small discipline that is not important from the outside looking in. However to those within the organisation such as management and decision makers management account provides key information on business operations and is in some ways the most important discipline in the business from an accounting perspective. What Is Management …
Businesses work with budgets to plan for future period operations. In very rare circumstances what was budgeted for and what actually happened are the same. In reality, more often than not there is a difference, a variance between budgeted figures and actual figures. The process of Variance analysis drills down into the numbers to find …
Management accounting as a discipline has grown as business has grown as a practice. While the name may bring to mind budgets, cost benefit analysis and costing the objectives of management accounting go far beyond those disciplines. What Is Management Accounting? Management accounting is a distinct accounting branch that provides information for management primarily for …
Businesses work with plans and one of the most important planning tools in business is a budget. A budget is an operational plan for a business expressed in monetary terms. There four types of budgets that businesses can use namely zero-based budgeting, value proposition budgeting, activity-based budgeting and incremental budgeting. Incremental budgeting is our focus …
Businesses have different degrees of complexity in their operations. While a reseller simply looks at cost of products to include the price they paid some businesses may have very complex cost structures due to manufacturing or other processes involved in getting the product ready to its saleable state. In addition to this service businesses differ …
Accounting is the process of recording financial transactions of a business. The accounting process includes summarizing, analysing, and reporting these transactions to oversight agencies, regulators, and tax collection entities. By looking at this definition we already have a good idea of some of the accounting branches. What Is An Accounting Branch? Different branches of accounting …
Accounting and accountancy are words that are often used interchangeably. While the two may seem quite similar there is a difference between accounting and accountancy. While the difference between the two is not easily discernible in a short sentence or paragraph we can look at some of the key roles of the accountant to gain …
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