Preparation of Financial Statements (Income Statement (I/S)) and Statement of Financial
Position (SOFP))
Notes:
Adjusting entries are NON-CASH, internal transactions no cash is coming in or going
out (cash not touched: not credited/ not accounted for)
DR and CR always by same amount
WATCH OUT FOR DATES THINGS NEED TO BE IN RELEVANT PERIOD if not the case,
merely leave values as they are (eig immer eine date trap)
also look at MONTHS
SOFP
Minus in brackets
Income Statement
NOTE DOWN END OF YEAR ON EXTRA SHEET AND ALWAYS KEEP IN MIND
(Company name)
Income Statement Year Ended (date)
£000 £000 Workings
Sales
Cost of sales
Gross Profit xxx
Administrative expenses
Rent
Salaries and wages
Heat and light
Distribution costs
Directors fees
Insurance
Audit fees
Bad debt written off
Increase in provision for doubtful
debt/ Provision release for
doubtful debt
Depreciation expense (separately
for several factors)
Operating profit xxx
Interest expense/receivable
Other income (dividend received)
, Profit/Loss on disposal of assets
Profit before tax
Taxation expense
Net profit for the year xxx
Statement of Financial Position
(Company name)
Statement of Financial position as at (same date as above)
£000 £000 £000 Workings
Cost Acc. Depr. NBV
Non-current assets
Land
Fixtures and Fittings
Plant and Equipment
Vehicles
Current assets
Inventory
Trade receivables
Less: Provision for
doubtful debts
Prepayments
Cash and Cash
equivalent
Total assets
Current liabilities
Trade and other
payables
Accrued expenses
Tax payable/ tax
liability
Non-current liabilities
Long-term borrowings
e.g. 8% Debenture
2020
Position (SOFP))
Notes:
Adjusting entries are NON-CASH, internal transactions no cash is coming in or going
out (cash not touched: not credited/ not accounted for)
DR and CR always by same amount
WATCH OUT FOR DATES THINGS NEED TO BE IN RELEVANT PERIOD if not the case,
merely leave values as they are (eig immer eine date trap)
also look at MONTHS
SOFP
Minus in brackets
Income Statement
NOTE DOWN END OF YEAR ON EXTRA SHEET AND ALWAYS KEEP IN MIND
(Company name)
Income Statement Year Ended (date)
£000 £000 Workings
Sales
Cost of sales
Gross Profit xxx
Administrative expenses
Rent
Salaries and wages
Heat and light
Distribution costs
Directors fees
Insurance
Audit fees
Bad debt written off
Increase in provision for doubtful
debt/ Provision release for
doubtful debt
Depreciation expense (separately
for several factors)
Operating profit xxx
Interest expense/receivable
Other income (dividend received)
, Profit/Loss on disposal of assets
Profit before tax
Taxation expense
Net profit for the year xxx
Statement of Financial Position
(Company name)
Statement of Financial position as at (same date as above)
£000 £000 £000 Workings
Cost Acc. Depr. NBV
Non-current assets
Land
Fixtures and Fittings
Plant and Equipment
Vehicles
Current assets
Inventory
Trade receivables
Less: Provision for
doubtful debts
Prepayments
Cash and Cash
equivalent
Total assets
Current liabilities
Trade and other
payables
Accrued expenses
Tax payable/ tax
liability
Non-current liabilities
Long-term borrowings
e.g. 8% Debenture
2020
