Anglais commercial

Measuring performance

Financial reporting

Financial statements are structured events affecting a company’s financial performance, and transactions carried out by it.

The financial statements now include:

  • Balance Sheet or Statement of Financial Position
  • The income statement or statement of comprehensive income
  • The Statement of Changes in Equity
  • Table of Cash Flows

These documents must be:

  • Intelligible
  • Reliable
  • Relevant
  • Relative important

The financial year

A/Budget

B/Control and achievements:

  • Compare achievements with forecasts
  • Make corrective actions
  • Analyze and explain any differences between forecasts and realizations.

C/Benefits and disadvantages of planning:

*Benefits:           

  • Have a global vision
  • Use means optimally
  • Rational management

*Disadvantages: 

  • High costs
  • Variable and uncertain databases
  • Risk of error

 

Shareholders, bondholders and landholders

  • Shareholders: An individual, group, or organization that owns one or more shares in a company, and in whose name the share certificate is issued.
  • Bondholders: A person owning a bond or bonds issued by a government or a public company.
  • Landholders: A person who owns land, especially one who either makes a living from it or rents it out to others.

Profit and loss account

  • Accruals counting :
  • Accrued expenses: expense is recognized before cash is paid out.
  • Accrued revenues: revenue is recognized before cash is received
  • Accruals payroll: a common benefit that an employer will provide for employee.
  • Profit and loss

*What is profit and loss statement?

The profit and loss statement is a summary of the financial performance of a business over time (monthly, quarterly or annually is most common).

Earnings

  • Routine earnings: are those that can be achieved by application of assets.
  • Non routine earnings: products that aren’t related to the main activities of a company.

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