Financial Accounting

The study of financial statements used to communicate a company's financial performance, including balance sheets, income statements, and cash flow statements.

What is financial accounting?

"The branch of accounting concerned with the summary, analysis and reporting of financial transactions related to a business."

Who are the stakeholders interested in financial accounting information?

"Stockholders, suppliers, banks, employees, government agencies, business owners, and other stakeholders."

What is the purpose of financial statements?

"This involves the preparation of financial statements available for public use."

What are some standards governing financial accounting?

"Generally Accepted Accounting Principles (GAAP) is the standard framework of guidelines for financial accounting used in any given jurisdiction."

Who issues the International Financial Reporting Standards?

"International Financial Reporting Standards (IFRS) is a set of accounting standards stating how particular types of transactions and other events should be reported in financial statements. IFRS are issued by the International Accounting Standards Board (IASB)."

What is the role of GAAP in financial accounting?

"It includes the standards, conventions and rules that accountants follow in recording, summarizing, and in the preparation of financial statements."

Who benefits from consistency in financial reporting?

"With IFRS becoming more widespread on the international scene, consistency in financial reporting has become more prevalent between global organizations."

What is the difference between financial accounting and managerial accounting?

"While financial accounting is used to prepare accounting information for people outside the organization or not involved in the day-to-day running of the company, managerial accounting provides accounting information to help managers make decisions to manage the business."

What is the main focus of financial accounting?

"Financial accounting is a branch of accounting concerned with the summary, analysis, and reporting of financial transactions related to a business."

What is the role of financial statements in decision-making?

"Stockholders, suppliers, banks, employees, government agencies, business owners, and other stakeholders are examples of people interested in receiving such information for decision-making purposes."

What is the purpose of GAAP?

"It includes the standards, conventions, and rules that accountants follow in recording and summarizing and in the preparation of financial statements."

Who establishes the Generally Accepted Accounting Principles?

"Generally Accepted Accounting Principles (GAAP) is the standard framework of guidelines for financial accounting used in any given jurisdiction."

What international organization is responsible for issuing accounting standards?

"IFRS are issued by the International Accounting Standards Board (IASB)."

What is the significance of IFRS in global financial reporting?

"With IFRS becoming more widespread on the international scene, consistency in financial reporting has become more prevalent between global organizations."

Who benefits from financial accounting information?

"Stockholders, suppliers, banks, employees, government agencies, business owners, and other stakeholders."

What type of accounting information does managerial accounting provide?

"Managerial accounting provides accounting information to help managers make decisions to manage the business."

Who uses financial statements for decision making?

"Stockholders, suppliers, banks, employees, government agencies, business owners, and other stakeholders are examples of people interested in receiving such information for decision-making purposes."

What is the purpose of IFRS?

"IFRS is a set of accounting standards stating how particular types of transactions and other events should be reported in financial statements."

What is the role of financial accounting in decision making?

"Financial accounting is used to prepare accounting information for people outside the organization or not involved in the day-to-day running of the company."

What is the purpose of financial accounting standards?

"Generally Accepted Accounting Principles (GAAP) is the standard framework of guidelines for financial accounting used in any given jurisdiction."