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    Airina Syahirah
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    Financial accounting involves two key concepts: financial reporting and the accounting process. Financial reporting is the formal recording and presentation of a company's financial activities and position in a structured manner. The accounting process, also called the accounting cycle, describes the sequential steps of recording, classifying, and summarizing financial data, which includes identifying transactions, recording journal entries, creating an adjusted trial balance, and preparing financial statements. The goal is to provide accurate and understandable financial information about a company.

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    Financial accounting involves two key concepts: financial reporting and the accounting process. Financial reporting is the formal recording and presentation of a company's financial activities and position in a structured manner. The accounting process, also called the accounting cycle, describes the sequential steps of recording, classifying, and summarizing financial data, which includes identifying transactions, recording journal entries, creating an adjusted trial balance, and preparing financial statements. The goal is to provide accurate and understandable financial information about a company.

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    7 views9 pages

    Financial Accounting (FFA)

    Uploaded by

    Airina Syahirah
    Financial accounting involves two key concepts: financial reporting and the accounting process. Financial reporting is the formal recording and presentation of a company's financial activities and position in a structured manner. The accounting process, also called the accounting cycle, describes the sequential steps of recording, classifying, and summarizing financial data, which includes identifying transactions, recording journal entries, creating an adjusted trial balance, and preparing financial statements. The goal is to provide accurate and understandable financial information about a company.

    Copyright:

    Attribution Non-Commercial (BY-NC)
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    Financial Accounting (FFA)

    Financial reporting

    Accounting process

    Financial Reporting

    Definition of Financial Reporting


    A way of recording, analysing and summarising financial data. Formal record of the financial activities of a business, person or other entity.

    All the relevant financial information , presented in a structured manner and in a form easy to understand are called financial reporting.
    The whole set of statement that needs to be prepared by accountants.

    Accounting Process

    Definition of Accounting Process


    Also known as Accounting Cycle. Based on the Oxford dictionary of Accounting, accounting cycle is the sequence of steps in accounting for a financial transaction entered into by an organization. It is also known as accounting cycle as the process is repeated in each accounting period.

    Steps in the accounting cycle

    Prepare afterclosing trial balance

    Identifying transaction

    Closing entries

    Analyzing transaction

    Prepare financial statement

    Accounting Cycle

    Journal entries

    Prepare adjusted trial balance

    Posting to ledger

    Adjusting entries

    Prepare trial balance

    Identify transaction
    Identify the transactions and prepare source documents.

    Analyze transaction
    Determine the transaction amount which accounts are affected and in which direction.

    Journal entries
    The transaction is recorded in the journal as a debit and a credit.

    Adjusting entries
    Are made for accrued and deferred items. The entries are journalized and posted to the T-accounts in the ledger.

    Prepare trial balance


    A trial balance is calculated to verify that the sum of debit is equal to the sum of credit.

    Posting to ledger
    The journal entries are transferred to the appropriate T-accounts in the ledger.

    Adjusted trial balance


    A new trial balance is calculated after making the adjusting entries.

    Financial statements
    The financial statements are prepared. Income statement Statement Of Financial Position

    Closing entries
    Transfer the balances of the temporary accounts (e.g revenues and expenses to owners equity)

    After closing trial balance


    A final trial balance is calculated after the closing entries are made.

    Fin
    Credits : http://www.quickmba.com/accounting/fin/cycle/ http://www.netmba.com/accounting/fin/process/ http://www.dummies.com/how-to/content/the-purpose-of-financial-reporting.html

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