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

Example on controlling working capital, Q. Example on Controlling working c...

Q. Example on Controlling working capital? Describe how a manufacturing company could control its working capital levels and impact of the suggested control measures. Solut

Describe the types of hazards that is found in z department, Z works for HS...

Z works for HS Company and has been asked to undertake an assessment of any health and safety issues that might be potential hazards in the department which she manages. Z's respon

Mba 7200, nd held it until it matured, what annual rate of return would she...

nd held it until it matured, what annual rate of return would she have earned? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16

Calculate the new interest rate and excel function pv, I want to see the so...

I want to see the solution that was provided in Feb 2013 for Calculate the new interest rate and excel function pv, Financial Accounting

What is cash credit, Q. What is Cash Credit? A cash credit is an arrang...

Q. What is Cash Credit? A cash credit is an arrangement by which a bank allows his customer to borrow money up to a certain limit against some tangible securities or guarantees

Advantages to the investors, Advantages to the Investors: The warran...

Advantages to the Investors: The warrant acts as a sweetener and ensures a better subscription to the NCDs, especially for companies with good track record. NCDs with warran

Define accounts receivable are sometimes not collected, Accounts receivable...

Accounts receivable are sometimes not collected.  Why do companies extend trade credit when they could insist on cash for all sales? Extending trade credit almost all the time le

Institutional clearing member, Institutional Clearing Member (ICM) A Fi...

Institutional Clearing Member (ICM) A Financial Institution has to subscribe to at least 100 equity shares of Rs.10,000 each to become an Institutional Clearing Member of COFEI

Statement of cash flows, Statement of Cash Flows A formal statement of ...

Statement of Cash Flows A formal statement of the cash received and disbursed through an organization. The statement of cash flows is separate into three sections that are inve

Expects the per capita expenditure, Expects the per capita expenditure: ...

Expects the per capita expenditure: A township expects its population of 5,000 to grow annually at the rate of 5%. The township currently spends $300 per inhabitant, but, as t

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