The Consolidated Financial Statements

Comprehensive Annual Financial Report (CAFR) is a report used by cities, and local governments to provide the public with their financial records each year, while adhering to government accounting standards board (GASB) guidelines. The report presents a comprehensive picture of the reporting entity’s financial condition, it provides how funds are spent and allocated throughout the year.

Statements are prepared in accordance with Generally Accepted Accounting Principles (GAAP), which refers to a set of rules, standards, and practices. They are used throughout the accounting industry to prepare and standardize financial statements that are issued and help investors and creditors compare companies within the same industry. Companies are expected to follow generally accepted accounting principles when they report their financial information. GAAP affects the measurement of economic activities and the disclosure of information about activities. It also affects the preparation and summarization of economic information, and the record keeping of measurements at average intervals.

While a budget might indicate that a specific government or agency has financial trouble and debt because of excess spending or mismanagement within the select grouping of general fund accounts presented, the CAFR may indicate, in whole, the same government entity, has many facets possessing large holdings considerably over what is shown in a budget report.

The Comprehensive Annual Financial Report (CAFR) is consists of three major sections- introductory, financial, and statistical.

Considering reporting entities, the Statement of Financial Accounting Standards No. 94 best defines and prescribes the recommended treatment. For example, the Statement of Financial Accounting Standards prescribes that consolidated reporting is the only appropriate method to report.

Separately, the balance sheet reports a company’s financial position while the income statement reports a company’s fiscal year profits and losses. The balance sheet measures a company’s financial position by reporting its assets, liabilities, and owner’s (shareholder’s) equity. The income statement measures a company’s financial performance by reporting its revenues, expenses, and net income/loss. When combined, they serve two vital purposes: (1) expand the accounting equation and (2) enable analysis using ratios to determine industry position or potential material misstatements. The increase or decrease in owner’s (shareholder’s) equity on the balance sheet is a direct result of the net

The Board of Directors declared a quarterly cash dividend of $0.20 per share on the company’s common stock. This increase in dividend was payable to shareholders of record on closed of business on May 11, 2016. In the first quarter of this year, the company brought back 1.0 million shares of its common stock at a cost of $50.0 million, with the expectation that it will return its free cash flow to shareholders in this year in the form of dividends and share of repurchases. The Cheesecake Factory knows the importance of success, therefore they schedule conference calls and webcast live on the company’s website throughout May 26, 2016. This ensure stakeholders that the company was not in the red, and continue to profit.

Two additional areas that concern management are accounting policies and FASB standards changing. Accounting policies dictate that “properties to be disposed of are reported at the lower of their carrying amount or fair value, reduced for estimated disposal costs, and are included in other current assets” (F. Phillips, 2006). The Landry’s acquisitions increased the properties to approximately 300, but as the disposal of the properties occurs the loss will be significant.

Figure 6 illustrated the consolidated income statement of Royal Mail plc. The expenses of this company revealed accordance with its function such as operating cost, transformation costs, operating specific item, finance cost etc. The advantage of implementing such method is that it allows Royal Mail plc to calculate its gross profit and operating profit within its income statement by using multi-step format. Furthermore, this method also requires companies to include their individual expenses on the face of income statement or in the notes to consolidated financial statements section.

Value investors use a variety of analytical techniques in order to estimate the intrinsic value of securities in hopes of finding investments where the true value of the investment exceeds its current market value.

According to the basis of preparation of accounting policies in the group annual report 2015, the group financial reports had prepared under Corporate Act 2001, Australian Accounting Standard Board and mandatory financial reporting requirements in Australia. And, the financial reports comply with International Financial Reporting Standard (IFRS) that issued by International Accounting Standard Board (IASB). However, the group annual report have changed their compliances except still applicable compliances to follow new

As it has always been a point of concern that people pay attention to the profitability of a company and this can be as a result of several reasons. For example, let’s picture a company that was not able to operate profitably, the bottom line of the income statement will indicate a Net Loss. Thus, a banker, lender or creditor may be reluctant to extend additional credit to the company. While on the other hand, if a company operates profitably, the bottom line of the income statement will indicate a net profit or income, which demonstrates its ability to use borrowed and invested funds in a successful manner. A company’s ability to operate profitably is important to current lenders and investors, competitors, government agencies, labour

To be recognized, revenues must be realized or realizable and earned. The revenue-earning activities include delivering or producing goods, rendering services or performing other activities that constitute its ongoing major or central operations, and revenues are considered to have been earned when the entity has substantially accomplished what it must do to be entitled to the benefits represented by the revenues [SFAC No. 5, “Recognition and Measurement in Financial Statements of Business Enterprises”] (Streaser, Sun, Zaldivar, & Zhang, 2014). The SEC, (Staff Accounting Bulletin No. 104) believes that revenue is generally realized or realizable and earned when the following criteria are met:

Financial statements have several key components and specific criteria into them to relay the detailed information for auditors and management. A deeper look into financial statements and the many concepts surrounding them are needed to explain in more detail. It’s also important to recognize the Auditor’s opinion letter, balance sheet, operating statement, statement of changes in net assets, and statement of cash flows and footnotes of their involvement in the process. Relevant accounting articles are a useful supplement to financial statements and how they enhance concepts in the financial statement. The meaningful uses of financial statements for health care organizations are the epitome of current and future success of financial health.

Financial statements have several key components and specific criteria into them to relay the detailed information for auditors and management. A deeper look into financial statements and the many concepts surrounding them are needed to explain in more detail. It’s also important to recognize the Auditor’s opinion letter, balance sheet, operating statement, statement of changes in net assets, and statement of cash flows and footnotes of their involvement in the process. Relevant accounting articles are a useful supplement to financial statements and how they enhance concepts in the financial statement. The meaningful uses of financial statements for health care organizations are the epitome of current and future success of financial