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Financial Accounting - Dr. Varadraj Bapat
Financial Accounting - Dr. Varadraj Bapat
Financial Statements What are they? Which are important Financial - - PowerPoint PPT Presentation
Financial Statements What are they? Which are important Financial - - PowerPoint PPT Presentation
Financial Statements What are they? Which are important Financial Statements? What purposes do they serve? Financial Accounting - Dr. Varadraj Bapat Company or Organisation PROVIDERS RESOURCES OF FOR MONEY BUSINESS These two
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Financial Accounting - Dr. Varadraj Bapat
Basic Business Model
Billing Money
Procurement
Consumption
Delivery
Collection
Business Cycle Value Addition Cycle Infrastructure People
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Financial Accounting - Dr. Varadraj Bapat
To be profitable, revenue should be more than cost ! This would make the organisation stronger, healthy and long-lasting.
Infrastructure
Billing Money Procurement Consumption Delivery Collection
Costs
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Financial Accounting - Dr. Varadraj Bapat
Balance Sheet Profit & Loss Account Liabilities
Capital Borrowings from Banks / FIs Current Liabilities
Assets
Fixed Assets Current Assets
- r Working
Capital Human Assets Outstanding
Infrastructure People
Procurement & Inventory Consumption & WIP Delivery & Billing Collection Money
Revenue Costs Profit/ Loss Balance Sheet shows the financial position of
- rganisation, while Profit & loss Account shows
the profitability of organisation.
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Financial Accounting - Dr. Varadraj Bapat
Balance Sheet shows the cumulative position
- f
resources (assets) and sources
- f
funds (liabilities) at the end of the year. Profit & Loss Account shows ‘Revenue & Cost’ performance during a quarter/ year.
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Financial Accounting - Dr. Varadraj Bapat
Balance Sheet Profit & Loss Account Liabilities
Capital Borrowings (eg.from Banks) Current Liabilities
Assets
Fixed Assets Current Assets
- r Working
Capital Human Assets Outstanding
Infrastructure People
Procurement & Inventory Consumption & WIP Delivery & Billing Collection Money
Revenue Costs Profit
Profits build up reserves & enable an enterprise to acquire new assets without borrowing money. Exactly the way we can acquire assets for our use without borrowing. Reserves
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Financial Accounting - Dr. Varadraj Bapat
Balance Sheet
Owners Funds Non Current
liabilities
Current
liabilities
Fixed Assets Non Current
Investments
Other non
current assets
Current
Assets
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Financial Accounting - Dr. Varadraj Bapat
The Annual Report Usually Contains ...
– Financial
statements which consist of
- Balance sheet, Profit & Loss A/c
- Cash Flow Statements
- notes to the financial statements
- disclosure of accounting policies
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Financial Accounting - Dr. Varadraj Bapat
The Annual Report Usually Contains ...
- Chairman’s Statement
- Board of Directors & Committees
- Directors Report
- Directors Responsibility Statement
- Auditors Report
- Report on Corporate Governance
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Financial Accounting - Dr. Varadraj Bapat
The Annual Report Usually Contains ...
- Consolidated Financial Statements
- Subsidiaries Financial Statements
- Management Discussion and
Analysis
- Annual General Meeting Notice