Module01 - Module 1 Financial Accounting for MBAs The Accounting Reporting System Information System Financial Reporting System Periodic financial

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1 Module 1: Financial Accounting for MBAs The Accounting Reporting System Information System Financial Reporting System Periodic financial statements and related disclosures Managerial Reporting System Detailed plans and continuous performance reports External Decision Makers Investors, creditors, suppliers, customers, etc. Internal Decision Makers Managers throughout the organization Financial Accounting for MBAs Role of Financial Reporting Essential Role of Financial Reporting Closer look at Business Activities Financial Statement Profitability Analysis Accounting Principles and Governance Balance Sheet Income Statement Statement of Stockholders’ Equity Statement of Cash Flows Footnotes Independent Auditor’s Report Oversight of Financial Reporting Regulatory and Legal Environment SEC Enforcement Actions Measuring Return on Net Operating Assets Disaggregating Return on Net Operating Assets
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2 Role of Financial Accounting What should be measured? When should we measure? How should we measure? When to communicate? The essential role of financial accounting is: 1. to identify, measure, and communicate financial information 2. about economic entities 3. to facilitate decision making and resource allocation 4. by interested parties. What is the relevant entity? Who are the interested parties? s2 Business Activities Financing Activities ± Financing activities refer to methods that companies use to raise the funds to pay for resources such as land, buildings, and equipment ± There are two main sources of financing: ± Equity financing ± Creditor (or debt) financing
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s2 to effectively manage a company or infer whether it is well managed, we must understand the company's fundamental business activities. financial accounting helps us understand these business activities
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This note was uploaded on 05/12/2010 for the course ACG 5065 taught by Professor Asare during the Spring '08 term at University of Florida.

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Module01 - Module 1 Financial Accounting for MBAs The Accounting Reporting System Information System Financial Reporting System Periodic financial

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