Financial Statements And Federal Single Audit Report: Fill & Download for Free

Accounting is the system of recording financial transactions with both numbers and text in the form of financial statements. It provides an essential tool for billing customers, keeping track of assets and liabilities (debts), determining profitability, and tracking the flow of cash. The system is largely self-regulated and designed for the users of financial information, who are referred to as stakeholders: business owners, lenders, employees, managers, customers, and others. Stakeholders utilize financial statements to help make business, lending, and investment decisions.Accounting has several specialized fields and roles. Private (internal) accounting generally refers to accountants who work within a single business entity. Small business accountants may assume general roles which require preparing the records (bookkeeping) and performing bank reconciliations. Accounting professionals are generally divided into three fields: tax, audit, and advisory. The tax field focuses on federal, state, and local tax filings. Audit roles test the validity of financial statements and internal controls. Advisory services perform general financial consulting. Public accounting firms have several different clients, whereas private accounting refers to working for one specific business entity.AccountsThere are five different types of accounts: asset, liability, equity, revenue, and expense. Each account type includes sub-accounts to record transaction details. For example, cash assets may include several different cash and savings accounts.Asset accounts: Cash and cash equivalents, accounts receivable, inventory, allowance for doubtful accounts (contra account), prepaid expense, investment, property, plant, and equipment, accumulated depreciation (contra account), intangible assets, accumulated amortization (contra account) and othersLiability accounts: Accounts payable, notes payable, accrued expenses, deferred revenue, long-term bonds payable and othersEquity accounts: Common stock, additional paid-in capital, retained earnings, treasury stock (contra account) and othersRevenue accounts: Sales revenue and othersExpense accounts: Selling, general, and administrative, interest, repairs, depreciation (non-cash), amortization (non-cash) and othersFinancial StatementsFinancial statements are the end results of the completed accounting record. They include the balance sheet, income statement, statement of shareholders’ equity, statement of cash flows, and notes to the financial statements. The information provides predictive value, feedback, and timely data to stakeholders.The balance sheet reports business assets, liabilities, and equity up to a specific time periodThe income statement reports the profit and loss activity for a specified period of timeThe statement of shareholders’ equity reports detail of investment received and prior earningsThe statement of cash flows reports the ins and outs of cash in three categories: Operating, investing, and financingThe notes to the financial statements disclose information that cannot be understood with the financial statements aloneDebits and CreditsDebits and credits is the system used for recording accounting transactions. A debit or credit transaction can increase or decrease balances, depending on the account type (asset, liability, equity, revenue, and expense). This forms the basis for double entry bookkeeping which requires equal debits and credits. The underlying transactions are recorded in detail on the general ledger and are later combined to form financial statements.The sum of debits always equals the sum of creditsThe sum of debits and credits are represented on opposite sides of the balance sheetAccounting StandardsAccounting standards set guidelines and rules for financial statement preparation. These are set via a combination of private industry organizations in cooperation with government committees. Generally Accepted Accounting Practices in the United States (US GAAP) largely governs the rules for recording transactions and disclosing critical business information to stakeholders. International Financial Reporting Standards (IFRS) governs international standards. Both systems require the use of double entry accounting. While both sets of standards are similar, there are significant differences such as allowed inventory methodologies and reporting asset valuation.Business Types and EntitiesAccounting serves diverse entities such as: individuals, companies, trusts, governments, and charities. These may be legally organized in a variety of ways: corporation, limited liability company, partnerships, and others. With the exception of governmental accounting, most accounting systems follow similar double entry, accrual accounting. Financial statements may have slightly different names, depending on the entity type. An income statement may also be called a profit and loss or earnings statement. A balance sheet may be referred to as the statement of financial condition.Managerial Accounting and AnalysisManagerial accounting is designed around the needs of managers and not necessarily regulated. It is for internal purposes and may employ any useful accounting system. Once the financial statements are compiled, the data may be analyzed using ratios and financial analysis. Accounting can provide powerful information to all stakeholders when properly maintained and interpreted.You can visit my website http://www.accountingplay.com/ where you can learn more about accounting.I also made an iOS app which turns this concept into a game, so I highly recommend giving it a try: Accounting Flashcards (AF): iOS | Android Accounting Quiz Game (AQG): iOS | Android Lessons, illustrations, video, & audio Questions to teach, not trick

Accounting is the system of recording financial transactions with both numbers and text in the form of financial statements. It provides an essential tool for billing customers, keeping track of assets and liabilities (debts), determining profitability, and tracking the flow of cash. The system is largely self-regulated and designed for the users of financial information, who are referred to as stakeholders: business owners, lenders, employees, managers, customers, and others. Stakeholders utilize financial statements to help make business, lending, and investment decisions.Accounting has several specialized fields and roles. Private (internal) accounting generally refers to accountants who work within a single business entity. Small business accountants may assume general roles which require preparing the records (bookkeeping) and performing bank reconciliations. Accounting professionals are generally divided into three fields: tax, audit, and advisory. The tax field focuses on federal, state, and local tax filings. Audit roles test the validity of financial statements and internal controls. Advisory services perform general financial consulting. Public accounting firms have several different clients, whereas private accounting refers to working for one specific business entity.AccountsThere are five different types of accounts: asset, liability, equity, revenue, and expense. Each account type includes sub-accounts to record transaction details. For example, cash assets may include several different cash and savings accounts.Asset accounts: Cash and cash equivalents, accounts receivable, inventory, allowance for doubtful accounts (contra account), prepaid expense, investment, property, plant, and equipment, accumulated depreciation (contra account), intangible assets, accumulated amortization (contra account) and othersLiability accounts: Accounts payable, notes payable, accrued expenses, deferred revenue, long-term bonds payable and othersEquity accounts: Common stock, additional paid-in capital, retained earnings, treasury stock (contra account) and othersRevenue accounts: Sales revenue and othersExpense accounts: Selling, general, and administrative, interest, repairs, depreciation (non-cash), amortization (non-cash) and othersFinancial StatementsFinancial statements are the end results of the completed accounting record. They include the balance sheet, income statement, statement of shareholders’ equity, statement of cash flows, and notes to the financial statements. The information provides predictive value, feedback, and timely data to stakeholders.The balance sheet reports business assets, liabilities, and equity up to a specific time periodThe income statement reports the profit and loss activity for a specified period of timeThe statement of shareholders’ equity reports detail of investment received and prior earningsThe statement of cash flows reports the ins and outs of cash in three categories: Operating, investing, and financingThe notes to the financial statements disclose information that cannot be understood with the financial statements aloneDebits and CreditsDebits and credits is the system used for recording accounting transactions. A debit or credit transaction can increase or decrease balances, depending on the account type (asset, liability, equity, revenue, and expense). This forms the basis for double entry bookkeeping which requires equal debits and credits. The underlying transactions are recorded in detail on the general ledger and are later combined to form financial statements.The sum of debits always equals the sum of creditsThe sum of debits and credits are represented on opposite sides of the balance sheetAccounting StandardsAccounting standards set guidelines and rules for financial statement preparation. These are set via a combination of private industry organizations in cooperation with government committees. Generally Accepted Accounting Practices in the United States (US GAAP) largely governs the rules for recording transactions and disclosing critical business information to stakeholders. International Financial Reporting Standards (IFRS) governs international standards. Both systems require the use of double entry accounting. While both sets of standards are similar, there are significant differences such as allowed inventory methodologies and reporting asset valuation.Business Types and EntitiesAccounting serves diverse entities such as: individuals, companies, trusts, governments, and charities. These may be legally organized in a variety of ways: corporation, limited liability company, partnerships, and others. With the exception of governmental accounting, most accounting systems follow similar double entry, accrual accounting. Financial statements may have slightly different names, depending on the entity type. An income statement may also be called a profit and loss or earnings statement. A balance sheet may be referred to as the statement of financial condition.Managerial Accounting and AnalysisManagerial accounting is designed around the needs of managers and not necessarily regulated. It is for internal purposes and may employ any useful accounting system. Once the financial statements are compiled, the data may be analyzed using ratios and financial analysis. Accounting can provide powerful information to all stakeholders when properly maintained and interpreted.You can visit my website Page on accountingplay.com where you can learn accounting in a fun way. I also made an iOS app which turns this concept into a game, so I highly recommend giving it a try: Accounting Flashcards (AF): iOS | Android Accounting Quiz Game (AQG): iOS | Android Lessons, illustrations, video, & audio Questions to teach, not trick

How? For a privately held company, it is not difficult to 'cook the books'. It is not a requirement that their financial statements be audited, so a senior accounting official could make or approve of any type of false entries and likely, nobody outside the company would be the wiser. Lower level accounting personnel could be aware of this, but have no vested interest in reporting it.Why? The most obvious reason would be to avoid paying taxes (via a under reporting of income) or, perhaps, to defraud investors of their rightful share of the profits.Detection. The only external agency I can think of that would have a vested interest in accurately-reported financial statements would be the ones which their income is dependent upon taxes the company pays. This would include the federal government (i.e. Internal Revenue Service), state income tax agencies, sales tax agencies, property tax agencies, business tax agencies and so forth.They run the information reported on tax returns and compare them to the averages calculated based on historical past returns for other companies of similar size and industry. This helps them to detect anomalies with any given tax return. If they 'smell blood', they'll audit the books of the company. Upon audit, the companies are required to provide source documents to 'prove' the legitimacy of their financial statements.Audits outside the scope of these red flags are also generally conducted on a random basis, so even if you have a 'squeeky clean' set of books, there is a single-digit-percentage chance you'll still be audited. It is their way of 'keeping everyone honest'.Additionally, in a publicly traded company, there are more checks and balances, so cooking the books becomes much more difficult. The financial statements are required to be audited by an independent third party. Like an IRS or similar tax audit, a group of accountants come in to examine the details of the financial records in accordance to generally accepted auditing principles, which are designed to detect inaccuracies. It is the job of the U.S. Securities and Exchange Commission (SEC) to protect the financial interests of public shareholders, so they also make inquiries on a periodic basis. Any CEO/CFO would be out of their minds to attempt to intentionally falsify financial statements, as there are way too many checks and balances in the system to be successful at attempting to defraud investors and the IRS.Further, US-based companies are subject to the laws outlined by the Sarbanes–Oxley Act (2002), which examines the internal controls of a company. Compliance is monitored by the companies external auditors and a report is issued to the company's board of directors.