Basic Financial Statements: Objectives, Categories, Principles and Presentation

Abstract

Objectives ae suggested for each of the basic financial statements in the annual report of a business entity. Categories of information required and the principles used in their classification, are identified and defined. A suggested presentation reflects cash flow alongside income statement information, and separates cash and income generated from cash distributed and income apportioned. Cash flow statements articulate with cash as a distinct category of assets, and a statement of changes in reserves provides the link between income statement and balance sheet.

Key Words or Phrases:

• – Objectives of Basic Financial Statements
• – Assets, Liabilities and Equity
• – Cash Flow Information
• – Matching and Realisation Principles
• – Statement of Cash Generated
• – Statement of Cash Distributed
• – Statement of Income Generated
• – Statement of Income Apportioned
• – Statement of Investment And Financing
• – Statement of Changes In Reserves

Additional information

Notes on contributors

J.A. Miller

Jean Miller is a senior lecturer in Accounting at the University of Natal.