UNIT 13: ACCOUNTING AND FINANCIAL STATEMENTS

cost accounting

calculating all the expenses involved in producing sth, including materials, labour, and other expenses

tax accounting

calculating how much an individual or a company will have to pay to the local and national goverment (and trying to reduce this to a minimum)

auditing

inspecting and reporting on accounts and financial records

accounting

preparing financial statements showing income and expenditure, assets and liabilities

managerial or management accounting

providing inf that will allow a business to make decisions, plan future operations and develop business strategies

creative accounting

using available accounting procedures and tricks to disguise the true financial position of a company

bookkeeping

writing down the details of transactions (debits and credits)

cash flow statement

a statement giving details of money coming into and leaving the business, divided into day-to-day operations, investing and financing

income statement (Statement of income, P&L statement, P or L account)

a statement showing the difference between revenues and expenses of a period

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balance sheet (Statement of financial position)

a statement showing the value of a business's assets, its liablities, and its capitals or shareholders' equity (money the business has that belong to its owners)

insolvency

an accountant working in this area acts for a person or company that is no longer able to pay its debts/ a company whose liabilities exceed its assets

forensic accounting

when a company's financial records are officially checked because the illegal activity is suspected

revenue

income/turnover/sales/the top line

cost of goods sold

direct costs includes manufacturing costs, salaries of manual (blue-collar) workers...

EBITDA

stands for Earnings Before Interest, Tax, Depreciation and Amortization

operating expenses

indirect costs/overheads, include salaries of sales and office staff, marketing costs, utility bills...

retained profit

is tranferred to the BS, where it joins the amounts from previous years

intangible assets

include patents, trademarks & goodwill (reputation, contacts and expertise of companies that have been bought)

inventory

the value of raw materials & stocl

current assets

may also include 'marketable securities' (shares intended for disposal within one year)

fixed assets

may also include long-term financial investments

accured items

are those where an expense has been incurred, but the money is not yet paid