Scribd
Upload
65 views18 pages

CFAS

This document provides an overview of key concepts in financial statements and reporting entities. It discusses the general objective of financial statements is to provide information on a reporting entity's economic resources, claims against the entity, and changes over a specified reporting period under the assumptions of a going concern, monetary unit, accounting entity, and time period. It also defines key elements like assets, liabilities, equity, income, and expenses; and describes different types of financial statements like consolidated, unconsolidated, and combined statements. Finally, it discusses concepts like the reporting entity, reporting period, underlying assumptions, accounting entity, time period, and monetary unit.

Uploaded by

Lyca Cosa
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
65 views18 pages

CFAS

This document provides an overview of key concepts in financial statements and reporting entities. It discusses the general objective of financial statements is to provide information on a reporting entity's economic resources, claims against the entity, and changes over a specified reporting period under the assumptions of a going concern, monetary unit, accounting entity, and time period. It also defines key elements like assets, liabilities, equity, income, and expenses; and describes different types of financial statements like consolidated, unconsolidated, and combined statements. Finally, it discusses concepts like the reporting entity, reporting period, underlying assumptions, accounting entity, time period, and monetary unit.

Uploaded by

Lyca Cosa
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Chapter 4

CONCEPTUAL
FRAMEWOR
K Financial Statements and Reporting Entity
Underlying Assumptions
OVERVIEW General Objective of Financial
Statements
Reporting Entity
Reporting Period
Going Concern
Accounting Entity
Time Period
Monetary Unit
GENERAL OBJECTIVE OF
FINANCIAL STATEMENTS
Provide information about economic
resources of the reporting entity, claims
against the entity and changes.
THE ELEMENTS OF
FINANCIAL STATEMENTS

1 ASSETS 4 INCOME

2 LIABILITIES 5 EXPENSES

3 EQUITY
FINANCIAL INFORMATION
1 STATEMENT OF FINANCIAL POSITION
- recognizing assests, liablities, and equity

2 INCOME STATEMENT
- recognizing income and expenses

3 STATEMENT OF CHANGES IN EQUITY


- recognizing cash flows from operating,
invertising, and financing activities

4 NOTES TO FINANCIAL STATEMENTS


- recognizing disclosures required by
TYPES OF FINANCIAL
STATEMENTS
1 STATEMENTS
CONSOIDATED FINANCIAL
- both the parent and its subsidiaries.

2 UNCONSOLIDATED FINANCIAL
- the parent alone.
STATEMENTS

3 COMBINED FINANCIAL STATEMENTS


- not linked by a parent and subsidiary relationship.
REPORTING
ENTITY
A reporting entity refers to an
organization, business, or individual
that is required to prepare financial
statements.
REPORTING ENTITY
The following can be considered a reporting entity:

Individual Corporation, Partnership or


Proprietorship

The parent alone

The parent and its subsidiaries as single


reporting entity
Two or more entities without parent and
subsidiary relationship as a single reporting entity

A reportable business segment of an entity


REPORTING
PERIOD
The reporting period is the period
when financial statements are prepared
for general purpose financial reporting.
REPORTING
PERIOD
Financial Statements are prepared for a specified period
of time and provide information about:

1 2
ASSETS, LIABILITIES, AND INCOME AND EXPENSES
EQUITY AT THE END OF DURING THE REPORTING
THE REPORTING PERIOD. PERIOD
UNDERLYING
ASSUMPTIONS
Accounting assumptions or accounting
postulates are the basic notions or fundamental
premises on which the accounting process is
based.
GOING CONCERN
The going concern of continuity assumption
means that in the absence of evidence to the
contrary, the accounting entity is viewed as
continuing in operations indefinitely.
ACCOUNTING
ENTITY
50
In financial accounting, the accounting entity
is the specific business organization which 40

may be a proprietorship, partnership, or


30
corporation.
20

10

0
Item 1 Item 2 Item 3 Item 4 Item 5
TIME PERIOD
The time period assumption requires that the
indefinite life of an entity is subdivided into
accounting periods which are usually of equal
length for the purpose of preparing financial reports
on financial position, performance, and cash flows.
MONETARY UNIT
The monetary unit is a fundamental concept
that assumes that money is the common
denominator for measuring and recording
financial transactions.
MONETARY UNIT
The monetary unit assumption has two
aspects which are:

QUANTIFIABILIT
Y
STABILITY OF THE
PESO
DOES ANYONE HAVE
ANY QUESTIONS ??
THANK
YOU

You might also like