FAC1502
Disclaimer
The information presented here have been prepared by specialist who are fully qualified and possess
extensive understanding of this module. Prescribed study material have been used to compile the
information presented here, and an external party was used to review the work presented below. All
workings are shown. However, CTM Tutoring solution Pty Ltd will not be held liable for any loss or
damage as a result of information presented in this document. Users should always verify the information
presented here. CTM Tutoring solution Pty Ltd does not guarantee any outcome from the use of
information presented in this document
, 1. 4
Accounting is therefore a process consisting of the following three activities:
Identifying those events that are evidence of economic activity (transactions)
relevant to the particular business or entity
Recording the monetary value of the economic events (transactions) in order to
provide a permanent history of the financial activities of a business. Recording
involves keeping a chronological diary of measured events in an orderly and
systematic manner and classifying and summarising economic events
Communicating the recorded information to interested users. This information is
communicated through the preparation and distribution of accounting reports, the
most common of which are known as financial statements.
2. 3
Financial statements can be prepared annually, six-monthly, quarterly or even on a
monthly basis. The financial statements prepared for periods of six months and less are
usually for internal use by management, for planning and control purposes. Annual
financial statements are compiled on the same date each year and are used by internal
(planning and control) and external parties. The period from that date in one year to the
day preceding it in the following year is a financial year. Financial statements must, by
law, be compiled annually for companies and close corporations.
Disclaimer
The information presented here have been prepared by specialist who are fully qualified and possess
extensive understanding of this module. Prescribed study material have been used to compile the
information presented here, and an external party was used to review the work presented below. All
workings are shown. However, CTM Tutoring solution Pty Ltd will not be held liable for any loss or
damage as a result of information presented in this document. Users should always verify the information
presented here. CTM Tutoring solution Pty Ltd does not guarantee any outcome from the use of
information presented in this document
, 1. 4
Accounting is therefore a process consisting of the following three activities:
Identifying those events that are evidence of economic activity (transactions)
relevant to the particular business or entity
Recording the monetary value of the economic events (transactions) in order to
provide a permanent history of the financial activities of a business. Recording
involves keeping a chronological diary of measured events in an orderly and
systematic manner and classifying and summarising economic events
Communicating the recorded information to interested users. This information is
communicated through the preparation and distribution of accounting reports, the
most common of which are known as financial statements.
2. 3
Financial statements can be prepared annually, six-monthly, quarterly or even on a
monthly basis. The financial statements prepared for periods of six months and less are
usually for internal use by management, for planning and control purposes. Annual
financial statements are compiled on the same date each year and are used by internal
(planning and control) and external parties. The period from that date in one year to the
day preceding it in the following year is a financial year. Financial statements must, by
law, be compiled annually for companies and close corporations.
