FINANCIAL REPORTING AND

ANALYSIS
Session 2: Balance sheet
9
th
July 2013
Financial Reporting and Analysis
Financial
Statements
Income
Statement
(Session
3 & 4)
Balance
Sheet
(Sessio
n 2)
Financial
Statements-
integrated exercise
( session 9)
Cash flow
Statement
(Session 7
& 8)
Accounting
The
Mechanics
of financial
Accounting
(Session 5
& 6)
1. Revenue
Recognition
(Session 10)
2. Accounting for
- Inventory (Session
(Session 11)
- Long Lived Assets
(Session 12)
- Liability and Equity
Financing (Session 13)
- Off Balance sheet
items (Session 14)
- Income Tax (Session
15)
- Consolidated
Financial Statements
(Session 16)
Financial
Analysis
- Annual
Report
(Session 17)
- Financial
Statement
Analysis
(Session 18 &
19)
Scope Of Financial Reporting
3
Financial reporting concepts and standards
Company
Transactions
Recording system
Report
preparation
Users of entitys
Financial
Statement
- Operating
- Investing
- Financing
Tracking and
recording
transaction
Financial
Statements
- Managers
- Investors
- Analysts
- Lenders
- Customers
- Suppliers
- Unions/
employee
- regulators
- Journal
- Ledger
- Closing and
Adjusting entries
- Balance sheet
- Income
statement
- Statement of
cash flows
Auditors
Users business decision
The meat of the matter
4
Assets
Liabilities
Equity

Sales
Costs and expenses
Profit and loss

Cash flows

AHM Case 2-3: Lone Pine Cafe (A)
Lone Pine Cafe (A)
Checking Account 10172
Cash register 1400 Loan 21000
Inventory 2800
Licence (1st Nov, 12 months) 1428
Equipment 53200 Mr Henry 16000
Mrs Henry 16000
Mrs Sandra 16000
69000 69000
Balance sheet as on November 2, 2005
Assets Liabilities
Balance sheet
Novemb
er 2,
2005
March
30,
2006
Novem
ber 2,
2005
March
30,
2006
Ski instructor
Account 870
Checking Account 10172 1341 Loan 21000 18900
Cash register 1400 1400
Account
payable 1583
Inventory 2800 2430
Licence (1st
Nov, 12
months) 1428 833 Mr Henry 16000 37146
Equipment 53200 50755 Mrs Henry 16000 12382
Mrs Sandra 16000
Total 69000 57629 69000 57629
Balance sheet
Assets Liabilities