会计英语

Understanding financial statements
The statement of comprehensive income (income statement) summarizes financial performance resulting from income (revenue and gains) less expenses (including losses).
The statement of changes in equity reconciles changes in equity (increases are caused by owner investments and net income, while decreases result from owner withdrawals/dividends and net losses.
The statement of financial position (balance sheet) details assets, liabilities, and equity.
The statement of cash flows shows the cash inflows and outflows from operating activities, investing activities, and financing activities.
The income statement summarizes net profit (or net loss) resulting from revenues less expenses.
The statement of owner’s equity reconciles changes in owner’s equity (increases are caused by owner investments and net profit, while decreases result from owner withdrawals and net losses).
The balance sheet details assets, liabilities, and equity.
The statement of cash flows shows the cash inflows and outflows from operating, investing and financing activities.
The difference between accounting and bookkeeping:
Accountant
An accountant is a professional with theeducation and experience to design anaccounting system
Bookkeeping
Bookkeeper is the recording routine transactions and day to day record keeping.
Accounting standards
1.Accounting assumptions
2.Accounting basis
3.Accounting principles
Accounting assumptions
Accounting entity assumption
Economic activity can be identified with a particular unit of accountability. In other words, the activity of a business enterprise can be kept separate and distinct from its owners and any other business unit.
Going concern assumption
Most accounting methods are based on the assumption that the business enterprise will have a long life. The going-concern concept, which holds that the entity will remain in operation for the foreseeable
future.
Monetary unit assumption
Accounting is based on the assumption that money is the common denominator by which economic activity is conducted and that the monetary unit provides an appropriate basis for accounting measurement and analysis.
Accounting period
The accounting period or time period assumption implies that the economic activities of an enterprise can be divided into artificial time periods of equal length.
Accounting basis
Cash basis
The accountant records a transaction only when cash is received or paid. Cash receipts are treated as revenues and payments are handles as expenses. It ignores receivables, payables and depreciation.
Accrual basis
An accountant recognizes the impact of a business transaction as it occurs. When the business performs a service, make a sale, or incurs an expense, the accountant must enter the transaction into the journal, whether or not cash has been received or paid.
Accounting principles：
The cost principle
The cost principle states that acquired assets and services should be recorded at their actual cost.
The realization principle
It means that revenue are usually measured in which they occur, rather than in the period in which they are collected.
The matching principle
Matching principle requires that revenues and expenses should be matched. It is well recognized that a business incurs expenses in order to earn revenues.
The objective principle
Accounting records and statements are based on the most reliable data available so that they will be as accurate and as useful as possible.
The full disclosure principle
It holds that a company’s financial statement should report enough information for outsiders to make knowledgeable decision about the company.
The materiality principle
Accountants must consider the relative importance of any transactions. The consistency principle
It implies that accounting methods shouldbe consistent from one period to the other and should not be arbitrarily changed.
Conservatism principle
It holds that accountants should be conservative in their selection of procedures-valuation of assets and determination of revenues, choosing those that is lower among several alternatives.
The accounting elements
1.Assets
An item of value that is owned and will provide future benefits is called an asset.
2.Liabilities
A liability is an amount owed to another business. The most common liability is account payable.
3. owner’s equity
The amount by which business assets exceed business liabilities is called owner’s equity.
4. Revenue
Revenue is the economic resources flowing into a business as a result of rendering goods sold and service.
3. owner’s equity
The amount by which business assets exceed business liabilities is called owner’s equity.
4. Revenue
Revenue is the economic resources flowing into a business as a result of rendering goods sold and service.。