Assets

Assets

What are assets? An asset can be referred to as an economic resource. Any resource that is controlled by the company as a result of past events and from which there’s future economic benefits. Characteristics of assets: One of the most accepted accounting definition of an asset is the one used by the International Accounting Standards Board. The following as a quote from the IFRS Framework: “An asset is a resource controlled by the enterprise as a result of past events and from which future…

Read More »

Revenue

Revenue

What does revenue mean? Income from activities that are ordinary for a particular business. Most of the businesses such as manufacturing or anyone who sells goods, revenue comes from the sale of goods. Service businesses such as law firms or accountants, receive most of their revenue from services that are rendered. Lending businesses like car rental agencies or banks, will receive most of their revenue from fees and interests that are generated by lending assets to organizations or individuals. Revenues from the business’s primary activities…

Read More »

Depreciation

Depreciation

Depreciation refers to two aspects of the same concept. The decrease in the value of assets and the allocation of the cost of assets in the period in which they are used. The former affects the balance sheetem while the latter affects the net income. The cost is generally allocated as an expense during the periods in which the asset is expected to be used. This expense is recognized by businesses for their financial reporting and tax purposed. The depreciation calculations may vary according to…

Read More »

Cash flow statement

Cash flow statement

What is a cash flow statement? A cash flow statement is a financial statement that shows how changes in the balance sheet accounts and income affects cash and cash equivalents. Basically, it’s concerned with the flow of cash in and out of the business. The statement captures the current operating results and the changes with it, in the balance sheet. The cash flow statement is useful in determining the short-term viability of a company. Purpose of the cash flow statement. The cash flow statement reflects…

Read More »

Liability

Liability

Liability is defined as the following: A liability is a present obligation of the entity that arises from past events. The settlement of the liability is expected to result in an outflow from the entity in the form of resources such as assets, providing a service or payment of an account. Explanation A liability is an obligation of the entity to transfer cash or other resources to another party. It could be (as an example) a bank loan. The bank loan obligates the entity to…

Read More »

Accounts Receivable

Accounts Receivable

Accounts receivable is a legally enforceable claim for payment from a business to its customers for goods they have purchased or services requested. These are normally in the form of invoices raised by a business and delivered to the customer for payment within an approximate time frame. Accounts receivable is shown in a balance sheet as an asset. Explanation of accounts receivable: Accounts receivable represents money that is owned by entities to the firm which sold them the products or rendered services on credit. In…

Read More »

Accounts Payable

Accounts Payable

Accounts payable means a liability to a creditor that’s carried on an open account. It is usually for the purchases of good and services. When a company orders and receives good or services in advance of a payment, we usually say the company is purchasing on account or credit. The supplier of the goods is referred to as the creditor. If the company that receives the goods, do not sign a promissory note, the supplier’s bill will be recorded in the company’s liability account “Accounts…

Read More »

PCAOB

Public Company Accounting Oversight Board (PCAOB)

The Public Company Accounting Oversight Board (PCAOB) is a private-sector, nonprofit corporation created by the Sarbanes–Oxley Act of 2002. It’s goal is to to oversee the audits of public companies and other issuers in order to protect the interests of investors and further the public interest. All of these coincide to the preparation of informative, accurate and independent audit reports. Since 2010, the PCAOB also oversees the audits of broker-dealers. This include compliance reports filed pursuant to federal securities laws in order to promote investor…

Read More »

Association of Accountancy Bodies in West Africa (ABWA)

Association of Accountancy Bodies in West Africa (ABWA)

The Association of Accountancy Bodies in West Africa (ABWA) is a regional organization of the International Federation of Accountants (IFAC). As of 2011 there were ten West African accounting institutes represented in ABWA History of the ABWA. The association was established on 10 August 1982 in Lagos, Nigeria, and was registered as a corporation in 1994. ABWA was initially collocated with the Institute of Chartered Accountants of Nigeria (ICAN) in Lagos. In May 2002 the association’s headquarters moved to the ICAN building in Abuja. The…

Read More »

PAFA

Pan African Federation of Accountants (PAFA)

The Pan African Federation of Accountants (PAFA) is the regional body that is aimed to represent African professional accountants with one voice. It is particularly in relations with the International Federation of Accountants (IFAC). The PAFA was inaugurated in Dakar, Senegal on 5 May 2011. Inauguration of the PAFA. The first president was elected at the inaugural meeting in Dakar, Senegal. He was Major General Sebastian Achulike Owuama. Owuama is also president of the Institute of Chartered Accountants of Nigeria and of the Association of…

Read More »