Balance Sheet and Consistency New Accounting

Topics: Balance sheet, Decision making, Asset Pages: 3 (476 words) Published: May 22, 2013
DQ 6.1, 6.2, 6.12, 6.13, 7.1 P6.9, P6.11, p7.7, P7.9

balance sheet
income statement
statement of cash flow
* 6.2
to disclose the information about the company that may effect future decisions, but is not necessarily included in financial statements 6.12
asset must be from a past transaction
must have future economic benefit
control by the entity
must have a present obligation
obligation involves economic cost in the future
* 7.1
no measurement of environmental impact
no sustainability issue
no measure of externalities
* 6.9
how useful is the information to decision making
how accurate is the information, how truthful and unbais is it for the use of financial documents understandability
not everyone who uses financial documents are accountants, does it attempt to be understandable so it can be utilized by everyone comparability
does it have a similar system to its close competitors so that their positions and performance can be compared consistency
does it use the same accounting method so that the progress of each year can be compared relevance and reliability
ignore small payments such as taxi fees since it isn’t material, but then the reliability of the document isn’t accurate relevance and consistency
new accounting methods for decision makers, but then there is an internal inconsistency comparability and consistency
new accounting method to be more comparable to other firms, but internal inconsistency relevance and understandability
information can be very complicated and difficult for decision makers to understand

annual leave: liability
1 mil payable: contingent liability
purchased goodwill: asset
patent: asset
excess of research and development cots: expense
* 7.7
scope 1: methane distruvtion
scope 2: electricity
scope 3: electricity from coal
* 7.9

DQ 6.4, 6.7, 7.32 P6.4, P.6.14

woolworths ltd
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