3 Financial Statements--MAP Form basis for understanding the financial position of a firmAllow users to assess historical and prospective financial performancePresent picture of firm’s financial health, leading to informed business decisions(C) 2004 Prentice Hall, Inc.
4 Financial Statements--MAZE Contain large amounts of informationAccounting policies and reporting requirements are complex and constantly changingAllow management considerable discretionHide or omit key information(C) 2004 Prentice Hall, Inc.
5 To ensure that financial statements serve as a map, not a maze Our Goal:To ensure that financial statements serve as a map, not a mazeThe better one can read and understand the financial statements, the more useful they are as a MAP to intelligent decision-making(C) 2004 Prentice Hall, Inc.
6 Why use financial statements? Savvy use of financial statementsallows user to assess:Financial position of the companySuccess of its operationsPolicies and strategies of managementInsight into future performance(C) 2004 Prentice Hall, Inc.
7 Volume of Information The Annual Report Financial statements Notes to the financial statementsThe auditor’s reportFive-year summary of key financial data(C) 2004 Prentice Hall, Inc.
8 The Annual Report Continued High and low stock pricesManagement’s discussion and analysis of operationsMaterial included at the imagination and discretion of management(C) 2004 Prentice Hall, Inc.
9 Financial StatementsAre prepared according to generally accepted accounting principles (GAAP)(C) 2004 Prentice Hall, Inc.
10 GAAPTwo authorities primarily responsible for establishing GAAP in the United States are the SEC and the FASB(C) 2004 Prentice Hall, Inc.
11 SEC Stands for Securities and Exchange Commission Regulates US companies that issue securities to the public(C) 2004 Prentice Hall, Inc.
12 FASB Stands for Financial Accounting Standards Board Comprised of 7 full-time paid membersIssues Statements of Financial Accounting Standards (SFAS) and InterpretationsLengthy deliberation process(C) 2004 Prentice Hall, Inc.
13 The Four Basic Financial Statements Balance SheetIncome Statement or Earnings StatementStatement of Shareholders’ EquityStatement of Cash Flows(C) 2004 Prentice Hall, Inc.
14 Financial Statement Notes: Are an INTEGRAL part of the statementsProvide summary of accounting policiesPresent detail about particular accounts (e.g. inventory, investments, etc.)Include other information (e.g. leasing arrangements, pending legal proceedings, income taxes, etc.)(C) 2004 Prentice Hall, Inc.
15 Financial Statement Notes: Continued Contain some supplementary information required by SEC and FASBExamples include:Information on foreign currency translations for firms doing business in/with foreign countriesInformation by segment for firms with several lines of business(C) 2004 Prentice Hall, Inc.
16 Keterbatasan Laporan Keuangan Merupakan Interim Report.Standar Nilai berbeda/berubah-ubahDisusun berdasarkan trasaksi keuangan berbagai waktu yang laluTidak mencerminkan berbagai faktor yang dapat mempengaruhi keadaan keuangn perusahaan(C) 2004 Prentice Hall, Inc.
17 Perlunya Pemeriksaan Oleh Akuntan Publik Dengan adanya keterbatasan yang dimiliki oleh LaporanKeuangan, maka diperlukan pemeriksaan oleh Akuntan Publik.Akuntan Publik setelah mengadakan pelitian dengan stradar danprosedur pemeriksaan yang lazim, kemudian akan memberikanpendapatnya akan kewajaran Laporan keungan yang disajikanoleh perusahaan yang telah sesuai dengan Prisip-prinsip Akuntasisecara konsisten dari tahun ke tahun.(C) 2004 Prentice Hall, Inc.
18 Auditor’s Report Unqualified Qualified Adverse opinion Scope limitationDisclaimer of opinion(C) 2004 Prentice Hall, Inc.
19 Auditor’s Report Continued Unqualified (what you want!)-- statements present information in conformity with GAAPQualified (not what you want)—are reports other than an unqualified opinion(C) 2004 Prentice Hall, Inc.
20 Auditor’s Report Continued Adverse opinion states that the financial statements have not been presented fairly in accordance with GAAPScope limitation means that the extent of the audit work has been limited(C) 2004 Prentice Hall, Inc.
21 Auditor’s Report Continued Disclaimer of opinion:Keep in mind that auditor is hired by the firm being audited--always the possibility of conflict of interest(C) 2004 Prentice Hall, Inc.
22 Management Discussion and Analysis (MD&A) Sometimes labeled “Financial Review”Contains information that cannot be found in the financial data(C) 2004 Prentice Hall, Inc.
23 Bentuk laporan Keuangan NeracaAdalah laporan sistematis tentang Aktiva, Hutang dan Modal dari perusahaan pada saat tertentuTujuan Neraca menunjukkan posisi Keuangan suatu perusahaan pada tanggal tertentu, biasanya pada waktu tutup buku di akhir tahun fiskal(C) 2004 Prentice Hall, Inc.
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