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Definition
| A system that collects and processes (analyzes, measures, and records) financial information about an organization and reports that information to decision makers. |
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Term
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Definition
| Also known as a statement of financial position, this statement reports the amount of assets, liabilities, and stockholders’ equity of an accounting entity at a point in time. |
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Definition
| The organization for which financial data are to be collected. |
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Term
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Definition
| Also known as the Statement of Income, the Statement of Earnings, and the Statement of Operations, this statement reports the revenues less the expenses of the accounting period. |
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Definition
| The time period covered by the financial statements. |
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| Statement of Retained Earnings |
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Definition
| Reports the way that net income and the distribution of dividends affected the financial position of the company during the accounting period. |
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Definition
| Reports the inflows and outflows of cash during the accounting period in the categories of operating, investing, and financing. |
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Definition
| Provides supplemental information about the financial condition of a company without which the financial statements cannot be fully understood. |
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| Generally Accepted Accounting Principles (GAAP) |
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Definition
| The measurement rules used to develop the information in financial statements |
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| Securities and Exchange Commission (SEC) |
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Definition
| The U.S. government agency that determines the financial statements that public companies must provide to stockholders and the measurement rules that they must use in producing those statements. |
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| Financial Accounting Standards Board |
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Definition
| The private sector body given the primary responsibility to work out the detailed rules that become generally accepted accounting principles. |
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Definition
| An examination of the financial reports to ensure that they represent what they claim and conform with GAAP. |
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Term
| Public Company Accounting Oversight Board |
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Definition
| The private sector body given the primary responsibility to issue detailed auditing standards. |
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