An adverse opinion is when auditors conclude that the business’s financial statement contains material misstatement. The opinion of auditors is based on the audit procedures … Read more
Inventory is an important asset for businesses, especially for the trading business as they purchase the finished products from the market and resell them by … Read more
Deferred shares are mostly issued to founders of a company as compensation. And these shares do not possess any rights to a company’s assets unless … Read more
What is value added tax-VAT? Value-added tax (VAT) is a tax that is charged at each level or point of sale where value addition is … Read more
Differences between actual behavior and planned behavior are analyzed quantitatively in variance analysis. By investigating areas in which unexpected failures have occurred, this analysis serves … Read more
Banks issue term loans to the public in exchange for specific borrowing terms and conditions. The repayment schedule of term loans is usually long term … Read more
Definition Return on net assets helps to understand how the business uses its assets base to generate the return. A higher return on net assets … Read more
Inventory ordering cost is a cost that is incurred when an entity places an order to acquire inventory from suppliers. This cost doesn’t only include … Read more
Financial analysis is a process of examining the financial data of an entity to assess its performance. The financial analysis of a company is used … Read more
Accounts titles are the building blocks for accounting, and it’s the place where accounting transactions are posted. In a double accounting system, the transactions impact … Read more
The qualified audit report is the report issued by auditors when they find certain discrepancies in the audit of financial statements. In other words, during … Read more
Audit risk is the risk that auditors may not be able to detect the risk of material misstatement in the accounting record of the business. … Read more
Permanent audit file contain documents to be used by auditors throughout their professional association with the client. It’s supposed to contain content permanent in nature … Read more
Getting bank confirmation is one of the most important audit procedures. Auditors tend to confirm the balance directly from the bank. They use a specific … Read more
Unpresented cheque is the cheque that has not been presented to the bank. Although the business has written and accounted for the cheque in their … Read more
Uncredited cheques are the cheques that have been collected by the business and recorded as the receipt of cash in the business books. However, the … Read more
Definition and explanation Price level accounting seeks to adjust financial statements due to fluctuation in the value of the currency. The currency fluctuation may be … Read more
Definition Cost element refers to the cost incurred on the purchase of resources; these resources are used to run the business’s production. The concept of … Read more
Trial balance is the listing for all the balances obtained from general ledgers; it’s an ending balance obtained from the general ledger and used to … Read more
Analyzing business transactions is the basis of a strong financial reporting framework. The posting of accounting transactions in the accounting record leads to changes in … Read more