Operational rules for financial management, Financial Management

Assignment Help:

Operational Rules for Financial Management

Besides features, certain operational rules are established as to the subsequent:

1) While revenue and expenses are reported;

2) How expenses are matched to revenue;

3) What to do whenever a choice could be made that might overstate or understate figures; and

4) What type of information should be disclosed so that the reader will fully understand the circumstances under which the information is being presented?

5) There are also basic assumptions upon which the reader could rely, such as:

6) The information is associated to the business entity only and doesn't have any unrelated information mixed in,

7) The business is a going concern & won't cease operations soon;

8) The financial information presented is measured in exact time intervals such as a month, quarter or year. The financial information is using a certain unit of measure such as Dollars, Rupees, Pound, etc.

9) The particular information is presented at historical cost, i.e., while received, paid, or incurred; and

10) The technique of accounting being used is double-entry and not some other method.

One of the basic reasons of accounting is to give financial information about a business enterprise to several users of accounting information for decision making purpose.The user of accounting information widely uses the information for the purpose of assessing profitability, financial position and actual performance, investment decisions credit, assessing taxes, decision, protecting investors and public interest, setting economic policies, measuring social & environmental protection programmes and negotiating labour agreements.


Related Discussions:- Operational rules for financial management

What is cash flow criteria, Q. What is Cash Flow Criteria? Cash Flow Cr...

Q. What is Cash Flow Criteria? Cash Flow Criteria: - Cash flow criteria are on the basis of cash flows rather than accounting profit. Cash flow methods are separated into two s

Explain the competitive benchmarking, Explain the Competitive Benchmarking ...

Explain the Competitive Benchmarking Healthcare services or Hospital are compared to rival 'competition 'in the same industry for instance methods of patient care and levels o

Examine the concepts related to financial management, Assume you are a prof...

Assume you are a professional financial analyst working for a wealthy investor.  Your client has $2.6 million to invest and wants to sink it into a single stock (diversification is

State the objectives of corporate financial, State the objectives of Corpor...

State the objectives of Corporate financial Corporate financial objectives could be to: 1. Provide the link between business and the other entities in environmentand 2.

Describe what is meant by application controls, QUESTION An audit team...

QUESTION An audit team is currently engaged in planning the audit of the financial statements of E Limited as at 30 June 2007. This was the first accounting period during which

Enumerate the cash flow statement analysis, Cash flow statement analysis ...

Cash flow statement analysis Cash flow statement is a primary financial statement and shows cash generating ability of the organisation. Cash generated from operations can b

Evaluate the fair value of the net assets, Treatment of PER IFRS 3 Bu...

Treatment of PER IFRS 3 Business combinations necessitate goodwill on gaining to be calculated at the date control is gained. The second gaining gives ROB a 75% holding and

Kim, Blossom Lawn expects to have total sales next year totaling $15,000,00...

Blossom Lawn expects to have total sales next year totaling $15,000,000 and the firm pays taxes at 35% and will owe $300,000 in interest expenses.

Define long run economic profit will be zero, Why do firms enter an industr...

Why do firms enter an industry when they know that in the long run economic profit will be zero? Firms enter an industry while they suppose to earn economic profit.  These shor

Federal open market committee, Federal Open Market Committee The princi...

Federal Open Market Committee The principle document making body of the Federal Reserve, the FOMC consists of 7 governors of the Federal Reserve System and 12 Federal Reserve D

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd