Financial statements and their users

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Task 1:

P2:

The limited company that I have picked in the UK is on:

ACCESS INTELLIGENCE is a company that is based in the UK. The company is a services provider in soft wares and computer equipment’s. The chosen company is a limited company that is on assessing the financial statement of the company cost, revenue in their total income of their reports.

More information on my chosen company Access Intelligence is an AIM listed company delivering niche software into highly regulated and high-risk markets. Our solutions enable companies to create and release value within their businesses by empowering governance, mitigating risk and driving compliance.

We combine the latest innovations in governance, risk and compliance (GRC), years of practical hands-on experience and software industry expertise, creativity and hard work, to deliver exceptional quality services and solutions to our blue-chip customer base, as a foundation to deliver strong returns to our investors.

My chosen companies link (http://www.accessintelligence.com/wp-content/uploads/2014/03/ai_annual_report_2013.pdf)

The company legal and regulatory framework shows:

Explaining of the limited company, in order for the company success they will probably have to ensure full compliance with legal and regulatory requirements, which includes certain disclosure items, so results they have to report and to include in their financial statements because of government laws and regulation requirements. The company has shown their policy towards on being environmental friendly with their workplace.

“Companies act are based on report that are made solely to the Company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006. “

(http://www.accessintelligence.com/wp-content/uploads/2014/03/ai_annual_report_2013.pdf)

“The Companies Act 2006 provides in relation to such financial statements that references in the relevant part of that Act to financial statements giving a true and fair view are references to their achieving a fair presentation.”

(http://www.accessintelligence.com/wp-content/uploads/2014/03/ai_annual_report_2013.pdf)

“The directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the parent company and to enable them to ensure that the financial statements comply with the Companies Act 2006”

(http://www.accessintelligence.com/wp-content/uploads/2014/03/ai_annual_report_2013.pdf)

“Mazars LLP has acted as auditors throughout the period and, in accordance with section 485 of the Companies Act 2006 a resolution to reappoint Mazars LLP will be put to the members at the forthcoming annual general meeting.” E

(http://www.accessintelligence.com/wp-content/uploads/2014/03/ai_annual_report_2013.pdf)

Explanation on the chosen company acts in how they plan on meeting their annual achievements. The acts of company states on how they are going to do better in their next report. This means the acts the business takes will be a result on the company and their employees who work with in the company. The company acts should be thought out carefully on where the company gathers their resources externally and internally Information. The company would have to go by the law of the governs rules and regulation on how the company should act towards their own business and other businesses around them and that they should also follow their policy standers protocols of running any business. The company would have to produce legal reports and meet to the requirements in order to meet the success of their company.

P3:

Adjustments for Access Intelligencefinancial statements:

This will show us the changes on MS excel, from the changes of the trial balance sheets. The adjustments I have made are the changes in placing the coordinates of each of the numbers from accrued interest revenue to placing of $725 of deferred supplies expense from the companies debit in which they have to pay from their account to their credits on which the company owns and have in their company bank accounts.

Account title

Debit

Credit

No

Accrued interest revenue

$750

750

1

Deferred service revenue

1500

$1,500

2

Accrued salaries expense

$800

800

3

Deferred insurance expense

$500

$500

4

Deferred expense supplies

725

$725

M2: The adjustments I have made of the trail balance sheet from adding and subtracting the numbers together have should us that the company had gain in revenue and have made a total of net profit of $225 dollars when converted into pounds it shows that the company have made 200.80 pound. This happens by taking 49,460 pounds then adding 800, then 500 and last 725 to get my end debit amount. For debit I added the numbers 750 and 1,500 to get my end result for credit amount. The total amount of number I got for debit was 51,010 and for credit 51,010 then I took the two numbers and minus the two to get my total profit of the company revenue in order to get the final amount balances I had to minus out 500 hundred from the two existing number to get my final result that is 51,010.

By looking at the balance sheet I can see that the company had made a profit in their income and not so much in a loss. The total profit that they have made from $49,460 they have added and subtracted to get their end result of $ 51,010 so their profit in which has risen is $1,010 in profit.

D1:

The list of users who uses accounting people

1) Investors: They use account information to see which companies are making a successful amount of profit for the investors to invest their money in and this mostly happens with brokers and stockholders who the people that mostly buy out big companies and developments. On the other hand many other people can invest money into an organization.

2) Bankers: banks use the account people to see on people who put their money into a bank account their earnings and incomes before hey can be allowed to give them aloan to start up a business or invest in a business this makes the loner liable for any loss of the money that he would have to pay back to the bankers in a matter of amount of time.

Governments:Uses accountings to check their countries accounts to make sure they are not making profit and are making a loss by having to many taxes the government would want the countries to make profit in their economy so they places taxes on the community. The government then uses accountings to get documents to check and see if they have paid their fair shares in taxation every year.

Employees:provide creditto the company from their labor work. Employees also uses accountings to check on other companies to see how they are doing in their income statement if it’s good or bad and if that business is making any money or not in the company.

Discussion: On the conventions and regulation impacts on financial statements of accountings.

Monetary measurements:

Accountants do not account for items unless they can be quantified in monetary terms. Items that are not accounted for (unless someone is prepared to pay something for them) include things like workforce skill, moral, market leadership, brand recognition, quality of management and so on.

Separate entity:

This convention seeks to ensure that private transactions and matters relating to the owners of a business are segregated from transactions that relate to the business.

Realization:

With this convention, accounts recognize transactions (and any profits arising from them) at the point of sale or transfer of legal ownership - rather than just when cash actually changes hands. For example, a company that makes a sale to a customer can recognize that sale when the transaction is legal - at the point of contract. The actual payment due from the customer may not arise until several weeks (or months) later - if the customer has been granted some credit terms.

These are the impacts that can happen from finacials statement regulation from accounting conventions.

References

  1. Retrieved on

http://www.accessintelligence.com/wp-content/uploads/2014/03/ai_annual_report_2013.pdf

1

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