Financial Reporting: Important Definitions
Financial Reporting: The act of providing statutorily mandated financial information to the investing public; different countries have different requirements and standards.
Financial Statements Refer to a company’s: income statement, balance sheet, statement of cash flows, and/or statement of changes in owner’s equity.
Long-term Assets: Include long lived assets and long-term investments, both of which are reported on the balance sheet.
Long-lived Assets: Refer to fixed assets (property, plant, and equipment - PPE), natural resources, and intangible assets (such as patents or goodwill) carried on the balance sheet. Note that this sheet primarily discusses long-lived assets as PPE, but there is some discussion of intangible assets.
Inflation: The scenario where an economy or business environment is experiencing rising prices.
Deflation: The scenario where an economy of business environment is experiencing falling prices.
- CFA Level 2: Financial Reporting Part 1 - Introduction
- Financial Reporting: Important Definitions
- FIFO and LIFO Methods for Inventory Expensing
- Inventory Accounting and Financial Statements
- Inflation/Deflation and Inventory Accounting Analysis
- LIFO – Tax and Cash Flow Note
- LIFO Reserve and Converting LIFO Net Income to FIFO Net Income
- LIFO Liquidation
- Inventory at Net Realizable Value
- Impacts of LIFO and FIFO Inventory Methods on Selected Financial Ratios
- Accounting of Long-lived Assets - Expensing vs. Capitalizing
- Depreciation Methods for Property, Plant, and Equipment (PPE)
- Impact of Depreciation Method
- Depreciation - Important Points
- Impairment of Long-lived Assets
- Impact of Asset Impairment
- Revaluation of Property, Plant, & Equipment (PPE)
- Leasing versus Purchasing Assets
- Traditional Lessee Accounting in US GAAP
- Effects of Leases on Selected Financial Reporting Items for Lessees
- Lessor Accounting for Leases
- Lessors and Sales-Type Capital Leases
- Lessors and Direct Financing Capital Leases
- Effect of Leases on Financial Statements for Lessors
- Future of Lease Accounting
- CFA Level 2: Financial Reporting 1 - Recommendations