Accounting Study Guide

Accounting Study Guide - Accounting Study Guide- Christa...

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Accounting Study Guide- Christa Palazzo Who is required: Publicly traded companies/ corporations : offer stock for sale to the general public typically through a  stock exchange (U.S- NYSE or NASDAQ). Required to file financial statements and disclosures. They  must file with the SEC quarterly (4 times per year every 3 months  10-Q. 10-k  annually every 12  months) Who cares: 1. Investors, shareholders, owners and financial analysts:  the use financial statements and  disclosures to assess profitability to determine whether they’ll get a good return on their  investments with companies. Want to know if the stock price will rise in the future. Analysts: make buy/sell recommendations  2. Lenders, creditors and credit-rating agencies  (moody’s, standard and poors):  \__ Banks and others  Use f.s’ to assess debt repayment ability (liquidity). Evaluate risk of not being repaid in a timely manner.  Debt covenant : loan agreement. Restrictions written in to the loan agreement designed to protect the  lender. Usually state min or max # or % the company needs to have. Potential consequence- borrowed  may be forced to pay entire loan immediately.    3. Management:  rely on more info than is available in the published financial reports. Top  executives may be interested in certain #’s where their compensation (bonus) is tied to the #’s.  Proxy statement - good source of info about board of directors, top executive compensation and  shareholder proposals resolutions. Managerial accounting - intended for use by people inside the company, more detailed than financial. Financial accounting- includes financial statements and related disclosers prepared primarily for external
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This note was uploaded on 04/17/2008 for the course AC 101 taught by Professor Ammons during the Spring '08 term at Quinnipiac.

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Accounting Study Guide - Accounting Study Guide- Christa...

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