News & Insights

U.S. Accounting: Before, Now, and the Future

Accounting has been a part of our everyday lives, perhaps since the beginning of time. During the seven years of prosperity, as recounted in the Bible, it is believed that someone made an inventory of the gathered food and received money all throughout the seven years of aridity and death in Egypt. Contemporary accounting techniques and measures were being utilized as far back as even during the time of the American Industrial Revolution in the 1800’s.Formal U.S. accounting may have started when the American Association of Public Accountants (AAPA) was established in 1887. The certificates issued by the organization were…

Understanding Balance of Stockholders’ Equity

Brief Review of the Balance Sheet The balance sheet sums up the financial health of an entity at a specific financial period by detailing its assets, liabilities, and equity. By comparing and contrasting the beginning owners’ equity with the ending owners’ equity, the user of the financial statement will know if the capital for that accounting period was expanded or abated. According to the Financial and Accounting Standards Board, the items to be reported on the balance sheet, and in any other financial statements, must be measurable, relevant, and reliable. The balance sheet contains three elements: assets, liabilities, and stockholders’…

Saving Money Through Proper Accounting

The current economic situation makes it a common occurrence for individuals and companies, whether big or small, to look for ways as well as employ measures of saving money. In so doing, they have resulted to reviewing salaries downwards, curtailing unrestricted expenditures, and laying off their employees. But, pursuing these austere measures is a phenomenon that can probably be avoided if the business owners or the entity’s management have an  effective, working, and proper accounting system in place.Proper accounting translates to good business. In line with this, utilizing certain technologies and hiring the right people will not only save enterprises…

Introduction to Income Statement

Overview of Financial Statements Financial statements are used by managers, shareholders, investors, lenders, and the government for different reasons and purposes. Essentially, financial statements show the financial status of an entity and are comprised of income statement, balance sheet, and cash flow statement. The Income Statement Also referred as an earnings statement or a profit and loss (P&L) statement, the income statement details the business’ financial performance for a certain month, quarter, and year. Unlike the balance sheet, the income statement evinces an entity’s business activity over time. In addition, it rehashes the generated income and deducts the incurred expenditures…

Introduction to Accounting Technologies

Historical Background on the Advances in Accounting Technologies Based on archaeological evidence, the ancient civilization employed different methods to keep track of their economic actions. One of the methods involved using small tokens. According to SchmandtBesserat, tokens were kept in clay jars and they embody economic proceedings. For instance, an entity’s balance statement is reflected on the quantity of tokens present in the clay jars. Graphic portrayals were also used in keeping records. Sumerians and Egyptians documented their business transactions on papyri and clay tablets not only to keep track and safeguard their properties, but also to demonstrate that the…