Accruals and Prepayments

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What is Matching principle in accounting?

By Hasaan Fazal on April 17, 2013

Accounting principle that requires costs to be recognized after matching with the revenues earned associated with such costs i.e. the amount of costs recognized must be on equal footings with the revenues recognized. In other words costs shall be recognized at the rate at which benefits are rendered or revenue/income is earned by the entity. […]

Posted in ACCA, ACCA - F3, ACCA - F7, Accounting Concepts & Conventions, Accounting Concepts and Policies, Accruals and Prepayments, CA, CAT, CAT - T1, CAT - T3, CAT - T6, CFA, CIMA, FA1, FA2, FFA, FIA, Financial Accounting, IASB Framework for Financial Statements, Module B, Module C | Leave a response

What is the difference between Cash basis and Accrual basis accounting and which one is better?

By Hasaan Fazal on April 4, 2013

Accrual basis of accounting is one of the underlying assumption for preparing financial statements under International Accounting Standards. IASB Framework clearly demanded the financial statements to be prepared on accrual basis instead of cash basis of accounting. Among other notable benefits of usig accrual basis of accounting over cash basis is that it helps record the […]

Posted in ACCA, ACCA - F3, ACCA - F7, Accounting Concepts & Conventions, Accruals and Prepayments, Accruals and Prepayments, CA, CAT, CAT - T3, CAT - T6, CIMA, CIMA C01, CIMA C02, FA2, FFA, FIA, Financial Account Basics, Financial Accounting, Financial Statements of Companies, Financial Statements of Sole Traders, IAS 1, IASB Framework for Financial Statements, Module B, Module C, Single Entry and Incomplete Records | Leave a response

What is Credit note and when is it used?

By Hasaan Fazal on November 9, 2012

A credit note is a source document providing evidence that a credit entry has been made in the financial records for specific reason which is explained on the face of this business document. Credit note is also known as credit memo or credit memorandum as it only notifies about the entry made in the financial […]

Posted in ACCA, ACCA - F3, ACCA - F8, Accounts & Ledgers, Accruals and Prepayments, Audit Documentation, Audit Evidence, Audit Evidence - Substantive Procedures, CA, CAT, CAT - T1, CAT - T3, CAT - T6, CAT - T8, Control Accounts, FA1, FA2, FAU, FFA, FIA, Financial Account Basics, Financial Accounting, IAS 2, Introduction to Auditing - Basics, Inventory, Module B, Module C, Rectification of Errors, Sales Tax, Single Entry and Incomplete Records, Source Documents & Books of Original Entry | Leave a response