Question

1.What types of financial statements can be prepared and what do they tell you?

2.What types of accounting records are required by a company according to legislation?

3.Using a workplace you are working in currently, have worked in previously or online research, obtain two policies and procedures relevant to the preparation of financial reports. For each of these policies and procedures summarise the critical aspects of this.

-You must also submit copies of the relevant policies and procedures for the assessors review.

Answer 1

1.What types of financial statements can be prepared and what do they tell you?

• Income Statement: It reveals the financial performance of the year by simply deducting expenses incurred from the revenue eanred
• Balance Sheet: It depicts the financial posiiton of the company as on the reporting date. It shows assets, liabilities and equity section of the company
• Cashflow Statement: It summarisies the cash inflows and outflows by segregating them into oprating, financial and investing activities.

2.What types of accounting records are required by a company according to legislation?

• Sales invoices
• Purchase orders
• Cash register
• Bank Stateements
• Expenses bills among others

Question 3

Two procedural policies are:

• Subsidiaries prepare the financial reports and duly get them audities by the auditors and then submit it to the main office where they are consolidated into group accounts. These group accounts are than audited by the groupd statutoty auditor and the financial reports are issued afterwards.
• When reproducing the financial statements in the annual report before statutory body like SEC, they must be exactly the same as those audited and certified by the Auditor-General (or delegate). No changes, however minor, are permitted.