Financial Accounting Essay

Investment Analysis for OrotonGroup Limited Table of Contents 1. Introduction 3 2. Business Model and Operating Environment 4 2.1 Business Model 4 2.2 Operating Environment 5 3. Horizontal and Vertical Analysis 6 3.1 Horizontal Analysis on Balance Sheet 6 3.2 Horizontal Analysis on Income Statement 9 3.3 Vertical Analysis on Balance Sheet 11 3.4 Vertical Analysis on Income Statement 13 4. Ratio Analysis 14 4.1 Ratio Analysis for OrotonGroup 14 4.2 Ratio Analysis for Country

a) According to the reading this week, the chapter discusses various financial tools that helps an individual and organizations to make better financial decisions. Such tools include the followings: (I) FINANCIAL STATEMENTS. The three basic financial statements are; The income statement:- This accounting tool communicates information about a business financial performance by giving details and summaries of revenues less expenses over a period of time. Revenues are generated when a business

is the reporting to whom. Financial accounting is meant for external reporting to all who are interested in the company’s activities. But in management accounting it is altogether an internal reporting aimed at helping managers in discharging their responsibilities. Financial accounting basically contains monetary information. But managerial accounting will contain both monetary and non-monetary issues that are helpful to the management. For example financial accounting will show only finance related

preparation. A preparation is a nonattest engagement in which the accountant is engaged to prepare the financial statements “and does not require a determination about whether the accountant is independent of the entity (AR-C 70.03).” For this engagement, the accountant is not required to be independent when providing preparation services since the accountant is not expressing any opinion on the financial statements, therefore providing no assurance (AR-C 70.04). Since there is no assurance provided, independence

Firm valuation relates to accounting in that it uses a combination of both accounting and financial methods and tools. Some of the accounting tools used includes the valuation of firms’ assets, valuation of a firm’s profit and loss and also the valuation of a firm’s obligations, which are liabilities. Just like accounting, firm valuation process follows defined steps so as to arrive at the correct value of the firm that is free from errors. “There are five steps involved; preparation and planning

to those investing in the company that Ebbers wasn’t the best choice to run the 2nd biggest telecom company in America. WorldCom was just one of many accounting frauds that took place in the early 2000’s. But unfortunately that trend of dishonest accounting didn’t stop. The reason behind writing this report is to examine the $11 billion accounting fraud the biggest in US history, the collusion between Ebbers and the CFO Scott Sullivan to deceive investors, causing the loss of thousands of jobs and

1.1 Accounting Record is documentations which shows the preparation of financial statements and records are normally looked at within audits and financial reviews. This includes things like ledgers, journals, recording of assets and liabilities and other supporting documents such as invoices. Prime Entry Books This is where transactions are normally first recorded. This would cover sales day book, sales return day book, purchase day book, purchase return day book, general journal and cash book. Ledger

The purpose of the Financial Accounting Standards Board (FASB) is to create and improve the standards of financial accounting and reporting for nongovernmental entities. It is a standard for not for profit financial reporting which provides useful information to investors and other users of financial reports. The Accounting Standards Update 2011-5 discusses the reporting and presentation of comprehensive income and its components in a full set of general purpose financial statements. The goal

The case that I am focusing on is the accounting scandal by WorldCom in 2002. WorldCom was a telecom company that purchased many other firms and eventually bought MCI, currently owned by Verizon. In the years it was still operating as WorldCom, it had already taken over most of the Internet and data communications market, being known as the second largest long distance telecom company before it went bankrupt. With all this happening, the company would have to face two challenges if they were to be

Financial Accounting Reporting Introduction In the last few years, the issue of financial regulations has been increasingly brought to the forefront. This is because of a number of high profile scandals are highlighting how abuses are occurring from the lack of regulation. A good example of this can be seen with adjustable rate mortgages (ARMs). In the early 2000s, this was considered to be an effective way for many low income and minority families to purchase a home. However, as the economy