LearningCat: Notes to Financial Statement
Notes to Financial Statements
Financial statements are like the initial draft of a company’s tale, but there’s a lot more to it than just the numbers. Sure, the balance sheet, income statement, and cash flow statements provide the fundamentals, but they do not necessarily provide the complete picture. This is where the notes to financial statements come in. Consider […]
How to Correct Errors in Notes to Financial Statements
Errors or mistakes can happen anytime in the financial statements irrespective of the company’s level of meticulousness took in the event of preparing them. These errors can bring the alteration to the whole financial canvas of the company via miscalculations and misstatements. It is vital to correct them in the required manner. This results in […]
How Notes to Financial Statements Are Used to Disclose Accounting Policies
Financial statements give you a snapshot of a company’s financial health, but the real story lies in the details. That’s where the notes come in. These remarks are not merely a side note. They’re the roadmap that explains how the numbers in the main statements—like the balance sheet or income statement—came to be. They lay […]
Going Concern Assumption
What is the Going Concern Assumption? The Going Concern Assumption is the basic doctrine in accrual accounting, proclaiming that the company will stay persisting into the coming years instead of facing liquidation. What Does Going Concern indicates? In accrual accounting, the going concern assumption is used for formulating the financial statements. That means the company […]
Financial Information in Operating Segments in India
Let us directly explore a fundamental concept in financial reporting—operating segments. In the realms of business or finance, segment reporting serves as a magnifying glass that focuses on several components of a corporation. Rather than examining the firm in all of its aspects, it breaks down the business into segments, illustrating the financial performance of […]
Changes in Accounting Estimates
Accounting estimates are everywhere, even if you don’t notice them. They shape how businesses figure out things like the value of their assets, how much to set aside for bad debts, or how long they expect equipment to last. But these numbers aren’t set in stone. They change. And when they do, there’s a whole […]
Events and Contingencies Following the Balance Sheet Date
This article discusses the following parts about AS 4 contingencies and events that take place after the balance sheet date: elevance of AS 4 Events and Contingencies That Take Place After the Balance Sheet Date Treatment in the financial statements of the following is covered by AS 4: Contingencies Events that occur after the balance […]
What is Revenue Recognition Concept?
The revenue recognition concept can be defined as an essential concept in accounting that instructs when and how an enterprise ought to acknowledge revenue within its financial disclosures. It also lays down the terms and conditions about whether the revenue earned is considered or not in the record. This idea states that revenue is often […]
Valuation of Inventories
Valuation of inventories is carried out to determine the value of excess inventory accumulation at the business site during the preparation of financial statements. Inventory requires having financial substance so that it can be documented in the financial reports of the company. The financial value of inventory aids in knowing about the inventory turnover ratio […]
Understanding Credit Risk in India
Credit risk is simple but catastrophic. It is the risk that a borrower would fail to repay the loan, causing the lender to suffer financial consequences. It might imply losing the money given, the interest, or both. Individuals might compare it to failing to repay a credit card or personal loan. For businesses, it is […]
Related Party Transactions
It is usual for business enterprises to be involved in business with their established professional and social connections. These firms can be significant shareholders, affiliate companies, or partially owned companies. The transactions can be related to sales, leases, loans, etc., referred to as related party transactions (RPT). Though these transactions are legal, they turn destructive […]
Pending Litigations in Contingent Liabilities
What Is a Contingent Liability? A contingent liability arises when unforeseen circumstances occur. These liabilities are documented if the contingency is expected and the figure of the liability can be fairly assessed. The liability may be revealed in a footnote in the financial statements unless both conditions are not fulfilled. In business, these contingent liabilities […]
Market Risk in India
Every investor, every company, and eventually the whole economy are all impacted by market risk. Market risk is ubiquitous in India, a nation that is a hive of opportunity and volatility. Let’s dissect it: What is market risk, how does it manifest itself in India, and what steps can you take to prevent being burned? […]
Liquidity Risk in India
Liquidity risk—sounds technical, but it’s actually something you experience every day, even if you don’t know it. In a country like India, where the economy is growing fast but still vulnerable to shocks, liquidity risk is something you can’t afford to ignore. So, let’s break it down. What is liquidity risk? When does it pop […]
Line Items Used in Financial Statements
Financial statements are the backbone of any business. They are the first thing you look at to understand the company’s financial state. The three key players in financial reporting—the Income Statement, Balance Sheet, and Cash Flow Statement—tell you everything you need to know about a company’s performance. They break down the numbers into line items, […]