Public Accounts 2010_1


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BC Finance Minister Colin Hansen released the 2009/10 Public Accounts July 8, 2010, showing the Province ended the fiscal year with a smaller deficit than forecast.

Accounting Tips Small Businesses Canada Accountant Oakville

Accounting Tips for Small Businesses in Canada by Accountant Oakville Mississauga

If you own a small business in Canada, then you must read this article. As an Accountant in Mississauga and Oakville, I will share the best accounting tips that will put your business on the path to financial success.

Accurate Books and Records

Account Tip #1 for Small Businesses in Canada – Keep accurate books and records

As a small business owner it’s very important that you keep accurate books and records in order to:

- Assess the profitability of your business
- Evaluate the financial health of your business
- Cut costs by identifying excess spending
- Have peace of mind when audited by the Canada Revenue Agency
- Apply for a long by presenting accurate financial statements to your bank

Review Financial Reports – Accounting Tips for Small Businesses in Canada – Accountant Oakville Mississauga

Accounting Tip #2 for Small Businesses in Canada – Review financial Reports Regularly

A proper accounting system should provide you with accurate, monthly financial reports such as:

• Income statements
• Balance sheets
• Goss margins by product
• Inventory listing
• Cash flow statements
• Budgets
• Financial statements by company division / department

With monthly cash flow statements you can identify the sources and uses of cash, which enables you to better manage company resources.

With monthly budgets for your small business in Canada, you can better plan for the coming months, and effectively manage cash inflows and cash outflows.

With departmental financial statements you can assess the profitability and financial health of each department.

If your current accounting system cannot produce appropriate financial reports, then you should seek the advice of an accountant in Mississauga or Oakville.

Purchase an effective accounting software package

Accounting Tip #3 for Small Business in Canada – Buy the right accounting software

Your small business in Canada requires an effective accounting software package to produce reliable financial reports.

“I recommend accounting programs such as QuickBooks Pro or Simply Accounting, both of which are great for small businesses,” says Allan Madan, Accountant Mississauga & Oakville.

In addition to the right accounting program, your small business in Canada requires an excellent bookkeeper. If you have a good accounting software package, but you lack a capable bookkeeper, then the information produced by the accounting system will not be reliable or useful.

Financial Controls – Accounting Tips for Small Business in Canada – Accountant Oakville Mississauga

Accounting Tip #4 for Small Business in Canada – Implement strong financial controls

Effective financial controls are a must for a small business in Canada. A lack of financial controls can lead to unreliable business intelligence, poor financial information and fraud.

Examples of financial controls are:

- Keep receipts for expenses. Without receipts you have no proof of purchases made.

- Maintain a separate credit card for business purchases only. The last thing that you want is a grocery bills or movie tickets appearing on your credit card. Imagine if a tax auditor saw that.

- Have a separate business account for your deposits and your business expenses. There should not be any personal expenses whatsoever in your business account.

- Keep a daily sales log and a deposit book so that you can track sales deposits. This will reduce the chance of employee theft.

- Dual signatures should be required on company cheques. If only one person has signing authority, then that person has the ability to commit fraud by writing cheques for invalid expenses.

- Review and approval all employee expense reports before they are paid, which will keep spending under control.

- Regularly backup your electronic financial data so you don’t permanently lose it

Consult with your accountant in Mississauga / Oakville on how to improve your small business’ financial controls.

Ken Boyd, owner of St. Louis Test Preparation (www.stltest.net) presents part 13 of his course on Understanding Intermediate Accounting. Boyd points out that students can have success with Intermediate Accounting concepts by making connections to actual examples from business. As a former CPA, College Accounting professor and Auditor, Ken has a wealth of experience to bring to the subject.

Double-Entry Accounting and Preparing a Trial Balance Sheet

In today’s world of economic instability, the proper use of information is the key to attaining success. Businesses depend on information that is relevant and reliable for better decision making. Accounting is the system which reports information such as income, assets, expenses, liabilities, and equity to guarantee economic regulation within a company. For this reason, accounting if often called “the language of business” because it is used to aid a company in their decision making process. In this article I will discuss the appropriate methods for  double entry accounting and preparing a trail balance sheet.

In order to fully understand the concept of double-entry accounting you must first be able to understand how debts, credits, and ledger accounts affect the accounting process. A ledger account or (T-account) is used to understand the effects of one or more transactions on a balance sheet or income statement. These accounts are named due to their shape looking like a (T), with the account title on top, a left side, and a right side. The right side of the T-account is usually referred to as the credit side (CR) and subsequently  the left side is called the debit side(DR). Thus to enter an amount on the right side is to credit the account and to enter an amount on the left side is to debit the account. Depending on the nature of the account, determines whether the debit or credit is an increase or decrease. For example: an asset T-account contains a debit as an increase and a credit as an increase; however an equity T-account is the opposite, in which the debit is decrease and the credit is increased.

Now that we have a general understanding of the way debits and credits affect the accounting process we can now gain an understanding of the ways to utilize these transactions, also known as double-entry accounting. Double-entry accounting is the process in which each transaction is recorded in at least two accounts. This results in a debit to one or more accounts and a credit to one or more accounts. It also means that the total amount credited must be equal to the total amount debited for each transaction made. The fact that the sum of each debited amount must equal the sum of each credited amount allows for accountants to quickly check accuracy within a business’s records. There are four main double-entry account types, which are the asset account, liability account, income account, and expense account. The asset account involves property, or any item that retains economic value owned by a company or individual, which can also be converted into cash. The liability account deals with things that an individual or company owes, for example a credit card balance or mortgage loan. The income account involves money that is earned by the company or individual, while the expense account deals with money spent by the company or individual.

 

Since double-entry accounting requires the sum of all debit accounts to equal the sum of all credit accounts, a trial balance is required to verify correctness. The trial balance is a list of accounts and their balances at a point in time. When preparing a trial balance, three steps are needed:

You must list each account title and the amount accrued in the trial balance. If an account has a zero balance, just list it with a zero in the normal balance column.
Next you must calculate the total amount of the debit balance, as well as, the total credit balance.
Last you verify that the total debit balance is equal to the total credit balance.

If the total debit balance and total credit balance are not equal then there must be an error that needs correction. If the credits and debits do appear equal on the trial balance, it still does not guarantee that no errors were made. The main goal of the trial balance sheet is to report whether the account balances are reported in the appropriate debit or credit columns and to allow for future reference of financial statements.

Auditorium – Accounting on an iPhone? Who knew


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Softline Pastel – a member of the Softline Group and a local leader in accounting, payroll and business software — has launched Pastel My Business Online, its first online accounting system, which targets small to medium businesses (SMBs).

“Very often, products become complicated by the sheer volume of features added to it over time," says Softline Pastel managing director Steven Cohen, who explained that by developing Pastel My Business Online from scratch, the company had the opportunity to design the software specifically for business owners who were either starting out with very little bookkeeping knowledge, or who only wanted a basic system.

See tinyurl.com/pastel-online

Wahid’s Belief – learn which accounting method is superior for your big business

Author comments: I have expressed about an ‘Accrual basis accounting and cash basis accounting’ method and the difference between these methods through a short, essay & plain approach in one of my articles “Wahid’s guess” I believe the learners would have understand about both of accounting method,

 

Now, in this article I have presented that which accounting method is better for an organization accounting structure, Again I have explained the meaning of two methods and others important elements for comprehend an students and readers so as to  below

 

Introduction: In cooperation Accrual and Cash are methods are approved by generally accepted accounting principles (GAAP) for small business. Only the Accrual method is acceptable for large businesses. For the reason that of Social Security Administration’s (SSA) dealing of income from self-employment, one method may be beneficial over the other, during this article I have mentioned which accounting method is better for an organization accounting structure

 

 

Meaning Accrual basis Accounting:

It is a method of accounting in which transaction are entered in the books of accounts, In accrual basis accounting, income is reported in the financial period it is earned, anyway when it is received, and expenses are deducted in the financial period they are incurred, In the Accrual method of accounting transactions are recorded when they happen rather than when the money is received or paid. This makes the accounting slightly more difficult because business  are dealing with goods that have been purchased but not paid for and sales that have been made but the cash has not been collected. Business record both revenues and expenses when they occur. For that reason, the focus is on the recording of flow of resources like labour, goods, services and capital. The related cash flow may take place after some time or it may or may not take place in the same accounting period.

 

Meaning Cash basis Accounting:

In the Cash method of accounting the business is run like a checkbook. When goods and services are purchased and paid for, they are recorded. When products are sold and the cash collected No consideration is given to the “due” fact of the transaction. This system of accounting is simple to understand and as such needs less skill on the part of the accountant. Its whole focus is on cash management. The recognition trigger is simply the flow of cash. Budgetary and legislative compliance is easier under this system. An example of the cash basis would be a sale of goods in January, but the money is not received from the customer until February. Under the Cash Basis of accounting, this would be considered income in February. If attendance at a trade show was planned for May but had to be paid for in March, in a cash basis accounting it would be expensed when it was paid for in March. This method of accounting.

 

 

Recompense or Advantages of the Accrual method Accounting

 

The method of Accrual Accounting as retaining the advantages of the Cash Accounting System overcomes its limitations or restrictions by addition of Cash Flow Statement in the Financial Statement of the entity. The major rewards are as below

 

I. As the accrual method shows the recede and flow of business income and debts more exactly, it may depart you in the gloomy as to what cash funds are obtainable,

 

II. Accrual accounting helps in the measurement of financial presentation by properly reflecting surplus/deficit as all expenses whether paid or not and all incomes whether received or not are duly accounted for.

 

III. Accrual accounting afford comprehensive information on expenses which helps in knowing the cost consequences of policies and enables comparison with different policies. Also, information about calculation of financial assistance can be extracted from the accounts, which helps in its validation. This ensures the adoption of best policy, which in turn assures best use of sparse resources. It also helps in determining the future sustainability of programmes

 

IV. Accrual method provides disclosures on account of dependent assets and dependent liabilities so that risk connected with the guarantees issued and letters of console given can be better assessed by the user of the financial statements

 

V. Accrual method discloses the Accounting Policies used in the groundwork of Financial Statements for better accepting and approval of the Financial Statements.

 

Restrictions Limitations of Accrual method accounting: this could result in serious cash flow problem. For case in point, your income ledger may show thousands of dollars in sales, although in reality your bank account is empty for the reason that your customers haven’t paid you yet.

 

The Restrictions or limitations of cash method accounting:

 

The method of cash accounting gives a wrong picture of income received, as advance tax receipts are recognized as income the major Restrictions or limitations are as below

I. It does not provide the complete picture of the financial position i.e. information on assets and liabilities are not available for fixed assets (land, building, machineries, heritage assets etc.)

II. It does not give the full information on current assets e.g. accrued income like outstanding royalty, fees, service charges, tax arrears etc. other than No information about capital work-in-progress like dams, power plants, roads and bridges etc. is available

III. It ignores certain transactions by not recording expenditure already incurred but payment not made e.g. supplies made, salary, telephone charges, overdue interest etc. and also revenue earned but cash not received e.g. license fees, services delivered (electricity, water etc.)

IV. It gives a wrong picture of income received, as advance tax receipts are recognized as income.

V. It provides room for fiscal opportunism e.g. tax revenues can be collected in excess during a particular period followed by high incidence of refunds together with interest, payments can be easily deferred and passed on to the next financial year, revenue due in the future could be compromised by providing for one time payments.

 

Due to the above disadvantages, it is not potential to get the real picture of the management financial performance and position.

 

Recompense or Advantages of the cash method accounting: the cash method provides a more exact picture of how much actual cash your business has; it may offer a confusing picture of longer-term profitability. Under the cash method, for case, firm books may show one month to be hugely profitable, when really sales have been slow and, by coincidence, a lot of credit customers paid their bills in that month. To have a firm and true thoughtful of business’s finances,

 

Mode of choosing an Accounting Method: When, how, & why we can choose whichever accounting method from both. (Accrual & cash method accounting) Most small businesses (with sales of less than million per year) are free to accept either accounting method. When we must use the accrual accounting method. We must use the accrual method if: our business has sales of more than million per year, or our business stocks an inventory of items that we will sell to the public and our  gross receipts are over million per year. Inventory includes any commodities our sell, as well as supplies that will physically become part of an item intended for sale. Either method we use, it’s important to realize that either one gives we only a partial picture of the financial status of our business

 

Techniques to choose which accounting method is better for organizations accounting structure

 

The cash method and the accrual method (sometimes called cash basis and accrual basis) are the two principal methods of keeping track of a business’s income and expenses. In most cases, we can choose which method to use. In this article I have explain. How they work and the advantages and disadvantages of each. so we can choose the better one from both accounting method for our business.

 

These methods are different only in the timing of when communication, including sales and purchases, are credited or debited to your accounts. Here’s how each works: the cash method. The cash method is the more normally used method of accounting in small business. Under the cash method, income is not counted until cash (or a check) is actually received, and expenses are not counted until they are actually paid.

 

Case in point: One of the businesses finishes a job in November, and doesn’t get paid until three months later in January. Beneath the cash method, we would record the payment in January. Beneath the accrual method, we would record the income in our November books.

 

The accrual method transactions are counted when the order is made, the item is delivered, or the services occur, regardless of when the money for them (receivables) is actually received or paid. In additional income is counted when the sale occurs, and expenses are counted when we receive the goods or services. We don’t have to wait until you see the money, or actually pay money out of our checking account, to record a transaction.

 

Another case in point: We purchase a new computer on credit in October and pay ,000 for it in December, two months later. Using the cash method, we would record a ,000 payment for the month of December, the month when the money is actually paid. Under the accrual method, we would record the ,000 payment in October, when we take the computer and become obligated to pay for it.

 

Why Accrual Accounting vital?

 

The extent of economic events that occur over a period of time has become more and more complex in the 21st century. There is now a common shove near accrual accounting as a technique of growing the international comparability of national economic accounting standards.

 

For this reasons of equally government and corporate decision-making strategy as well as fundamental analysis, it is important to calculate economic trial in the time period when they essentially occur as opposed to the period when monetary dealings are made. In some cases, payments under government social programs, such as Medicaid grants, are dependent on formulas attached to personal income; inaccurate revenue inference may lead to beneath- or overpayment of curriculum settlement. Further commonly, accrual dimension of economic series is significant for the accurate estimate of economic trends over time.

 

Conclusion: The best represents the authentic condition (in other words the “true and fair” view) should be used. If proceeds from tax is not calculable and is vague or complicated to understand, then the accurate standard would be to identify such income on cash basis. The accrual-based system that basically follows the ethics of conservatism and measurability requires that we “expected no gains, but afford for losses”. In the background of government accounting, recognizing expenditure on accrual basis meets the criteria of conservatism, measurability and achievability

 

The fundamentals of accounting explained in a couple of minutes
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Glossary of Accounting Terms

Bling Lingo made simple

Today…again…I was scratching my head over an accounting mess, for which the owner had paid a bookkeeper many dollars over many years. How did it happen? If you don’t know the basics, you are a sitting duck, my friend. You know, accountants do it on purpose. They use weird words to make you think that they are smarter than you are. To keep you in the dark. Or, the less nasty ones just don’t know better.

Good accountants and bookkeepers want you to learn the lingo. They want to help you make the bling, baby! So, read and learn. Keep this glossary handy as you work with your professional money managers. Use it to begin your journey to financial literacy!

Bling Lingo – Glossary of common Accounting Terms…

ACCOUNTING EQUATION: The Balance Sheet is based on the basic accounting equation. That is:

Assets = Equities.

Equity of the company can be held by someone other than the owner. That is called a liability. Because we usually have some liabilities, the accounting equation is usually written…

Assets = Liabilities + Owner’s Equity.

ACCOUNTS: Business activities cause increases and decreases in your assets, liabilities and equity. Your accounting system records these activities in accounts. A number of accounts are needed to summarize the increases and decreases in each asset, liability and owner’s equity account on the Balance Sheet and of each revenue and expense that appears on the Income Statement. You can have a few accounts or hundreds, depending on the kind of detailed information you need to run your business.

ACCOUNTS PAYABLE: Also called A/P. These are bills that your business owes to the government or your suppliers. If you have ‘bought’ it, but haven’t paid for it yet (like when you buy ‘on account’) you create an account payable. These are found in the liability section of the Balance Sheet.

ACCOUNTS RECEIVABLE: Also called A/R. When you sell something to someone, and they don’t pay you that minute, you create an account receivable. This is the amount of money your customers owe you for products and services that they bought from you…but haven’t paid for yet. Accounts receivable are found in the current assets section of the Balance Sheet.

ACCRUAL BASIS ACCOUNTING: With accrual basis accounting, you ‘account for’ expenses and sales at the time the transaction occurs. This is the most accurate way of accounting for your business activities. If you sell something to Mrs. Fernwicky today, you would record the sale as of today, even if she plans on paying you in two months. If you buy some paint today, you account for it today, even if you will pay for it next month when the supply house statement comes. Cash basis accounting records the sale when the cash is received and the expense when the check goes out. Not as accurate a picture of what is happening at you company.

ASSETS: The ‘stuff’ the company owns. Anything of value – cash, accounts receivable, trucks, inventory, land. Current assets are those that could be converted into cash easily. (Officially, within a year’s time.) The most current of current assets is cash, of course. Accounts receivable will be converted to cash as soon as the customer pays, hopefully within a month. So, accounts receivable are current assets. So is inventory.

Fixed assets are those things that you wouldn’t want to convert into cash for operating money. For instance, you don’t want to sell your building to cover the supply house bill. Assets are listed, in order of liquidity (how close it is to cash) on the Balance Sheet.

BALANCE SHEET: The Balance Sheet reflects the financial condition of the company on a specific date. The basic accounting formula is the basis for the Balance Sheet:

Assets = Liabilities + Owner’s Equity

The Balance Sheet doesn’t start over. It is the cumulative score from day one of the business to the time the report is created.

CASH FLOW: The movement and timing of money, in and out of the business. In addition to the Balance Sheet and the Income Statement, you may want to report the flow of cash through your business. Your company could be profitable but ‘cash poor’ and unable to pay your bills. Not good!

A cash flow statement helps keep you aware of how much cash came and went for any period of time. A cash flow projection would be an educated guess at what the cash flow situation will be for the future.

Suppose you want to buy a new truck with cash. But that purchase will empty the bank account and leave you without any cash for payroll! For cash flow reasons, you might choose to buy a truck on payments instead.

CHART OF ACCOUNTS: A complete listing of every account in your accounting system. Every transaction in your business needs to be recorded, so that you can keep track of things. Think of the chart of accounts as the peg board on which you hang the business activities.

CREDIT: A credit is used in Double-Entry accounting to increase a liability or an equity account. A credit will decrease an asset account. For every credit there is a debit. These are the two balancing components of every journal entry. Credits and debits keep the basic accounting equation (Assets = Liabilities + Owner’s Equity) in balance as you record business activities.

DEBIT: A debit is used in Double-Entry accounting to increase an asset account. A debit will decrease a liability or an equity account. For every debit there is a credit.

DIRECT COSTS: Also called cost of goods sold, cost of sales or job site expenses. These are expenses that include labor costs and materials. These expenses can be directly tracked to a specific job. If the job didn’t happen, the direct costs wouldn’t have been incurred. (Compare direct cost with indirect costs to get a better understanding of the term.) Direct costs are found on the Income Statement, right below the income accounts.

Income – Direct Costs = Gross Margin.

DOUBLE-ENTRY ACCOUNTING: An accounting system used to keep track of business activities. Double-Entry accounting maintains the Balance Sheet: Assets = Liabilities + Owner’s Equity. When dollars are recorded in one account, they must be accounted for in another account in such a way that the activity is well documented and the Balance Sheet stays in balance.

You may not need to be an expert in Double-Entry accounting, but the person who is responsible for creating the financial statements better get pretty good at it. If that is you, go back through the book and focus on the ‘gray’ sheets. Study the examples and see how the Double-Entry method acts as a check and balance of your books.

Remember the law of the universe…what goes around, comes around. This is the essence of Double-Entry accounting.

EQUITY: Funds that have been supplied to the company to get the ‘stuff’. Equities show ownership of the assets or claims against the assets. If someone other than the owner has claims on the assets, it is called a liability.

Total Assets – Total Liabilities = Net Equity

This is another way of stating the basic accounting equation that emphasizes how much of the assets you own. Net equity is also called net worth.

EXPENSE: Also called costs. Expenses are decreases in equity. These are dollars paid out to suppliers, vendors, Uncle Sam, employees, charities, etc. Remember to pay bills thankfully, because it takes money to make money. Expenses are listed on the Income Statement. They should be split into two categories, direct costs and indirect costs. The basic equation for the Income Statement is:

Revenues – Expenses = Profit

(You’ll see a profit if there are more revenues than expenses!…or a loss, if expenses are more than revenues.)

Remember, all costs need to be included in your selling price. The customer pays for everything. In exchange, you give the customer your services. What a deal!

FINANCIAL STATEMENTS: refer to the Balance Sheet and the Income Statement. The Balance Sheet is a report that shows the financial condition of the company. The Income Statement (also called the Profit and Loss statement or the ‘P&L’) is the profit performance summary.

Financial Statements can include the supporting documents like cash flow reports, accounts receivable reports, transaction register, etc. Any report that measures the movement of money in your company.

Financial Statements are what the bank wants to see before it loans you money. The IRS insists that you share the score with them, and asks for your Financial Statements every year.

GENERAL LEDGER: Once upon a time, accounting systems were kept in a book that listed the increases and decreases in all the accounts of the company. That book was called the general ledger. Today, you probably have a computerized accounting system. Still, the general ledger is a collection of all Balance Sheet and Income Statement accounts…all the assets, liabilities and equity. It is the report that shows ALL the activity in the company. Often this listing is called a detail trial balance on the report menu of your accounting program. The detail trial balance is my favorite report when I am trying to find a mistake, or make sure that we have entered information in the right accounts.

GROSS PROFIT: This is how much money you have left after you have subtracted the direct costs from the selling price.

Income – Direct Costs = Gross Profit. When this is expressed as a percentage, it is call Gross Margin.

This is a good number to scrutinize each month, and to track in terms of percentage to total sales over the course of time. The higher the better with gross margin! You need to have enough money left at this point to pay all your indirect costs and still end up with a profit.

INCOME STATEMENT: also called the Profit and Loss Statement, or P&L, or Statement of Operations. This is a report that shows the changes in the equity of the company as a result of business operations. It lists the income (or revenues, or sales), subtracts the expenses and shows you the profit J! (Or loss L.) This report covers a period of time and summarizes the money in and the money out.

The Income Statement is like a magnifying glass that shows the detail of activities that cause changes in the equity section of the Balance Sheet.

INDIRECT COST: Also called overhead or operating expenses. These expenses are indirectly related to the services you provide to customers. Indirect costs include office salaries, rent, advertising, telephone, utilities…costs to keep a ‘roof overhead’. Every cost that is not a direct cost is an indirect cost. Indirect costs do not go away when sales drop off.

INVENTORY: Also called stock. These are materials that you purchase with the intent to sell, but you haven’t sold them yet. Inventory is found on the balance sheet under assets. It is considered a current asset because you will convert it into cash as soon as you sell it. Beware of turning cash into inventory. You may run out of cash. Work with your suppliers to keep inventory SMALL.

JOURNAL: This is the diary of your business. It keeps track of business activities chronologically. Each business activity is recorded as a journal entry. The Double-Entry will list the debit account and the credit account for each transaction on the day that it occurred. In your reports menu in your accounting system, the journal entries are listed in the transaction register.

LIABILITIES: Like equities, these are sources of assets – how you got the ‘stuff’. These are claims against assets by someone other than the owner. This is what the company owes! Notes payable, taxes payable and loans are liabilities. Liabilities are categorized as current liabilities (need to pay off within a year’s time, like payroll taxes) or long term liabilities (pay-back time is more than a year, like your building mortgage).

MONEY: Also called moola, scratch, gold, coins, cash, change, chicken feed, green stuff, BLING, etc. Money is the form we use to exchange energy, goods and services for other energy, goods and services. Used to buy things that you need or want. Beats trading for chickens in the global marketplace.

Money in and of itself is neither good or bad. I want you to make lots of it, and do great things with it!

NET INCOME: Also called net profit, net earnings, current earnings or bottom line. (No wonder accounting is confusing – look at all those words that mean the same thing!)

After you have subtracted ALL expenses (including taxes) from revenues, you are left with net income. The word net means basic, fundamental. This is a very important item on the income statement because it tells you how much money is left after business operations. Think of net income like the score of a single basketball game in a series. Net income tells you if you won or lost, and by how much, for a given period of time.

By the way, if net income is a negative number, it’s called a loss. You want to avoid those. The net income is reflected on the Balance Sheet in the equity section, under current earnings (or net profit). Net income results in an increase in owner’s equity. A loss results in a decrease in owner’s equity.

RETAINED EARNINGS: The amount of net income earned and retained by the business. If net income is like the score after a single basketball game, retained earnings is the lifetime statistic. Retained earnings is found in the equity section of the Balance Sheet. It keeps track of how much of the total owner’s equity was earned and retained by the business versus how much capital has been invested from the owners (paid-in capital).

Each month, the net profits are reflected in the Balance Sheet as current earnings. At the end of the year, current earnings are added to the retained earnings account.

Government Accounting Career

It is really hard to ignore the fact that an accounting is one of the major integral parts of every business and industry around the world whose work is creative, diverse, and exciting. Though, the groundwork to enjoy a successful career in accounting generally starts in the high school, but in the broad sense the learning never ends. These days, becoming associated with any professional organization as an accountant is generally counted among the best means to continue a competitive edge in this ever changing marketplace. However, there are other several methods to progress through the accounting occupation and develop a great career in accounting, and fortunately government accounting jobs is one of them.

Generally, governmental accounting is one of the major buzzwords that are primarily used to describe the different accounting systems utilized by several public sector entities. Now in the United States, there are basically two broad platforms in the government that pursue different standards of accounting. At the federal level, the standards are basically established and maintained by the Federal Accounting Standards Advisory Board while at the state and local level of government, it is the Governmental Accounting Standards Board that majorly set the standards.

The key feature that makes government accounting unique is the source of income and authorization of expenditures. In government accounting, the source of income and general permission of expenses are basically created by legislative action instead of a management policy. Adding to this, the governmental accounting also demands a whole different outlook in comparison to an accounting in the private sector. Generally, the governmental accounting system makes use of a historic structure of finance accounting where self balancing accounts are accountable for running sources that are allotted to definite explicit resources.

Today as an accountant, you have various career options in government accounting. Generally, the Department of Treasury has almost 13 departments, which deal with fiscal and tax reforms, and each of this division appoints accountant. Thus, if you hold an accounting degree then you can easily find an employment with the Internal Revenue Service (IRS). Besides this, in your government accounting career you may find job option with the Federal Bureau of Investigation.

In your federal government accounting career, you may be more involved in studying different white-collar crimes, fraud, bribery and other organized crimes. Moreover, you may also work at the state or local level or the federal level and administer and formulate budgets, track costs and analyze programs. In addition to this, if we talk in terms of job options then you may also find several other opportunities with different State agencies. The State Board of Accounts, Department of Financial Institutions and such other government agencies are few options where you can easily employment.

Apart from this, a government accounting career even provides competitive pay along with opportunities to advance your career to all new level. It offers the development in most organizations to controller and probably to advanced administrative positions. They have competitive perks that is better in comparison to any other profession. So by now if you are looking to make a career in the government accounting then all you need is to be certified as either of the following: Certified Management Accountant, Certified Public Accountant, Certified Internal Auditor and Certified Fraud Examiner. No doubt, today a career in government accounting is well-paid, and holds more respect.

An Historic Account of the Black Empire of Hayti


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www.ScienceofBusines… Goldratt Theory of Constraints Throughput Accounting is NEW technology relative to Cost Accounting. Discover why you don’t really “lose money on a job”.