Explain the context and purpose of the financial reporting : case study on Peek-a-Boo Essay

Fiscal accounting

Table of content

1.0 Recognitions:

2.0 Introduction:

3.0 Selected Administration: Peek-a-Boo

3.1 ABOUT: Peek-a-Boo

4.0 CONTEXT AND PURPOSE OF FINANCIAL Coverage:

4.1 PURRPOSE OF FINANCIAL REPORT:

4.2 MIAN USERS AND NEED FOR ACCOUNTING Information:

5.0 CHARACTERISTIC OF THE FINANCIAL INFORMATION:

6.0 Accounting CYCLE AND DOUBLE ENTRY:

7.0 Decision

7.0 Mention:

1.0 Recognitions:

First of all, I would wish to thank all-powerful Allah, for being with me at every clip, and bettering my cognition in this field to finish this enlightening study.

I unfeignedly like to thank # # # cubic decimeter, for happening clip for the interview from their busy agenda and sharing all the relevant information about fiscal accounting in bopeep.

End I would besides wish to thank, all my friends in # # # concern school, for assisting me to acquire great thoughts, and sharing general information for bring forthing the study.

2.0 Introduction:

The chief intent of this study is to place and explicate the context and intent of the fiscal coverage. Additionally the study will besides consist a clear information about the features of fiscal information.

Furthermore, the study consist the stairss taken in an accounting rhythm and dual entry with the relevant illustrations of selected organisation.

However, this study enables the viewing audiences to understand and acknowledge the intent of fiscal coverage and accounting environment successfully.

3.0 Selected Administration: Peek-a-Boo

3.1 ABOUT: Peek-a-Boo

Peek-a-Boo is a private limited company which buys and sells playthings to its clients. The proprietor of the concern is Mr. Thoha Hussain, Mr. mumthaz Hussain, and Mr. Ahmed Arif. Peekaboo was existed in the market in the twelvemonth of 2012.

Peekaboo sells universe category, quality branded original playthings and wireless controlled merchandises. It sells the plaything non merely within the store. Peekaboo has besides provided an on-line service, to do it easier for the clients to buy playthings from them.

Peekaboo fiscal twelvemonth starts from 1stJanuary and stop with 31stDecember. They besides used to enter diaries in computerized system utilizing speedy book package. Furthermore, the chief stakeholders of bopeep are stockholder and MIRA.

( Hussain, 2015 )

4.0 CONTEXT AND PURPOSE OF FINANCIAL Coverage:

4.1 PURRPOSE OF FINANCIAL REPORT:

Fiscal studies are the paperss and records that put together to track and reexamine of how much money that the concern is doing or non.

The chief intent of this fiscal coverage is to present this information to the loaners and stockholders of the concern. In peekaboo plaything shop, fiscal study is used to compare with its old old ages and other stores in order to do determination for the hereafter.

( boies, 2015 )

4.2 MIAN USERS AND NEED FOR ACCOUNTING Information:

  • Owners/shareholders:

Chiefly they want to cognize whether their concern is on the write manus.

Owners need accounting information to cognize the fiscal public presentation of the concern. Furthermore, they besides need to cognize the fiscal place of the concern.

For illustration, in bopeep proprietors use to cognize the current place of its assets against liability. ( Fazal, 2015 )

  • Management:

In bopeep directors use it for be aftering, determination devising and profitableness coverage. They used to find the degree of success achieved and can be achieved from the operations. ( Fazal, 2015 )

  • Investors:

Investors are the possible beginning of finance to concern.

Investors require information if the concern promise a favourable return on their investing and how long investing can remain profitable sing affiliated factors. ( Fazal, 2015 )

  • Creditors:

Creditors wanted to be certain if the money will acquire paid and whether offering extra recognition to the concern wise.

( Fazal, 2015 )

  • Employees:

Employees want to measure how much net income concern made and how much can be distributed to employees in footings of fillip and premium.

( Fazal, 2015 )

  • Customer:

Customers have involvement in cognizing if the entity can supply them on continued footing without any break.

( Fazal, 2015 )

  • Government:

Government want cognize if the revenue enhancement has been calculated suitably they require information which is collected through accounting

( Fazal, 2015 )

  • Tax Governments:

To find the credibleness of the revenue enhancement return filed on behalf of the company. Peekaboo ever has to direct their accounting information to MIRA, to place that the existent revenue enhancement is paid.

( Fazal, 2015 )

5.0 CHARACTERISTIC OF THE FINANCIAL INFORMATION:

  • Relevance:

It requires the fiscal information to be relevant to the determination doing demands of the user.

  • Materiality:

It requires the comptrollers and hearers to concentrate on fiscal information which is expected to impact the determination of the user.

  • Faithful representation:

It requires the fiscal information to be true and just and free from misstatement.

  • Comparison:

It require the fiscal information to be comparable across period and across companies.

In bopeep chiefly fiscal studies are used to compare with its old twelvemonth and other stores like retail stores.

  • Comprehensibility:

It require the fiscal information to be apprehensible by users with sensible cognition of concern and economic activity.

  • Seasonableness:

It require revelation of fiscal information non to be overly delayed.

  • Verifiability:

It require the information to pass on the implicit in economic of the company concern.

( January, 2011 )

6.0 Accounting CYCLE AND DOUBLE ENTRY:

Accounting rhythm is a measure by measure procedure of recording, categorization and summarisation of economic dealing of a concern. It generates utile information in the signifier fiscal statement including income statement, balance sheet, hard currency flow statement and statement of alterations in equity.

( January i. , 2013 )

1-occurance of dealing:

Examples: when something is sold in the store or in on-line. Gross saless grosss and bill are some of the beginning papers used in bopeep.

2-analyze of dealing

Based on the happening of dealing it analyze on which history does it consequence and by how much.

3- Recording of dealing

Examples: sold a distant control auto for Rf. 250

Dr. Cash 250

Cr. Gross saless 250

4- Posting to ledger histories:

Each sum in the diary is transferred to the appropriate leger histories.

In the hard currency book gross revenues is recorded in the debit side of the book as Rf.250. And in gross revenues ledger history hard currency is recorded in the recognition side of the history as Rf.250

5- Preparation of test balance:

A list of all the history and their balances is prepared to guarantee the truth of the recording and posting procedure by doing certain the amount of debit balance peers to sum of recognition balance.

6- Adjustment of balances

The comptrollers will analyze if there is an mistake in test balance and update it before the readying of fiscal statement.

7- Preparation of fiscal statement

The fiscal statements are prepared from the history balances determine after seting the entries.

Fiscal statement can be use internally and externally, under fiscal statement, income statement, hard currency flow statement, balance sheet and statement of alterations in equity are prepared.

8- Closing impermanent histories

After the terminal of each fiscal twelvemonth, all histories balances are transferred to retain net incomes history and all the impermanent histories are closed.

7.0 Decision

Peekaboo is an spread outing company which sells toys both on-line and store. So they do hold different minutess.

Peekaboo’s fiscal histories and information is prepared and manage by another company which is chiefly formed to pull off the accountings of the other company, hence overall bopeep does non confront any jobs in doing fiscal information, and they do pull off all the histories clearly.

7.0 Mention:

Fazal, H. ( 2015 ) . pkPAK Accountants. Retrieved from www.pakaccountants.com: hypertext transfer protocol: //pakaccountatns.com/courses/financialaccounting/users/

Hussain, I. S. ( 2015, 4 8 ) . finnancial information.

January, I. ( 2013 ) . accounting explained. Retrieved from www.accountingexplained.com: hypertext transfer protocol: //accounting explained.com/financialcycle/

January, O. ( 2011 ) . accounting explained. Retrieved from www.accountingexplained.com: hypertext transfer protocol: //accounting explaind.com/financial/principle/qualitative-characterisetics

boies, J. w. ( 2015 ) . dummies.com. Retrieved from www.dummies.com: hypertext transfer protocol: //www.dummies.com/how-to/content/the-purpose-of-financial-reporting.html

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Fairooz Ahmed ( 47461 )