Question

Please, Complete the following information, with short answers: -

• General Ledger and Reporting Cycle: -
  • What is its Purpose?
  • What are its Resources?
  • What are its Documents?
  • What are its Reports?
  • What is its Information?
  • What are its Activities?
  • What are its Sub-Processes?
  • Diagram the Process with the Input & Outputs?

Answer 1

General Ledger and Reporting Cycle:

Purpose - The general ledger holds account information that is needed to prepare the company's financial statements and transaction data is segregated by type into accounts for assets, liabilities. owner's equity, revenues and expenses. The transaction details contained in general ledger are compiled and summarized at various levels to produce a trial balance, income statement, balance sheet, statement of cash flows, and many other financial reports. This helps accountants, company management, analysts, investors and other stakeholders assess the company's performance on an ongoing basis.

Resources - Day books, journal vouchers, Cash receipt and payment records, Invoices, Purchase orders, Debit and Credit notes, Cash vouchers, Bank statements, Bank reconciliations, etc.

Documents - Sales and purchases invoices, debit/credit notes, Payment vouchers, Bank statements

Reports - Trial balance, income statements, balance sheet, cash flow statement, MIS reports etc.

Information - General ledger transactions are a summary of transactions made as journal entries to sub ledger accounts. General ledger accounts encompass all the transaction data needed to produce the income statement, balance sheet, and other financial reports. The trial balance is a report that lists every general ledger account and its balance, making adjustments easier to check and errors easier to locate.

Activities - Individual transactions are posted to individual sub ledger accounts as defined by chart of account of company. The transaction are then closed out or summarized to the general ledger, and from there the trail balance is generated. The trial balance is checked for errors and adjusted by posting additional necessary entries and then adjusted trial balance is used to generate the Financial statements.

Sub processes - Accounts receivable, Accounts Payable, Banking, Reporting

Process -