Chapter 1 Psutka F11

Chapter 1 Psutka F11 - Chapter1 FinancialStatements&...

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Chapter 1 Business Decisions
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Financial Statements Four Major Statements Statement of Financial Position (Balance Sheet) Statement of Comprehensive Income (Income  Statement) Statement of Changes in Equity (Statement of  Shareholders Equity) Statement of Cash Flows
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Disciplin e Balanc e Flexibilit y Sense of Citizenshi p UNDERSTA ND APPLY INTEGRAT E Functional Competencies Understandin g Business Ethical Conduc t P E R S O N A L Q U I T Professionalis m K W D GE Communicatio n Skills Learning How to Learn Leadership & Collaborative Skills Thinking & Problem Solving Skills
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The Accounting System Collects and processes financial information about an organization and reports information  to decision makers Understanding Business Operations The  Business  Operation Purchase  materials Manufacture  kitchen cabinets Sell  cabinets Collect  Cash
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Accounting Information System Financial Accounting System (preparation of four basic financial statements) AFM 101 Managerial Accounting System (preparation of detailed plans, forecasts and reports) AFM 102 External Decision Makers ( investors, creditors, suppliers, customers, etc.). Internal Decision Makers (managers throughout the organization). Understanding Business Operations
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Why do we need financial accounting? Creditors Investors Potential Business
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To ensure the accuracy of the company’s financial information, management: Ø  Maintains a system of controls. Ø  Hires outside independent auditors. Ø  Forms a committee of the board of directors  to review these two safeguards. Management Responsibility and the  Demand for Auditing LO 3
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Generally Accepted Accounting  Principles (GAAP)/IFRS Financial Accounting translates events into  financial statements Events
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This note was uploaded on 10/27/2011 for the course AFM 101 taught by Professor Kennedy during the Fall '08 term at Waterloo.

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Chapter 1 Psutka F11 - Chapter1 FinancialStatements&...

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