INTRODUCTION TO FINALCIAL

ACCOUNTS
ASST. PROF. SANGEETA GUPTA
NAME ROLL NUMBER NO OF SLIDES

TRUPTHI BORANA 15 4
ABHISHEIKH
16 0
CHARAMPEN
HARSH CHAVAN 17 0
2
CHETNA CHOUDHARY 18

PALAK CHOUGLEY 19 3

MAYUR DAGA 20 2

SACHIN DANGAR 21 0
Inventory Valuation
◦ Inventory valuation is an accounting practice that is followed by
companies to find out the value of unsold inventory stock at the
time they are preparing their financial statements. Inventory stock
is an asset for an organization, and to record it in the balance sheet,
it needs to have a financial value. This value can help you
determine your inventory turnover ratio, which in turn will help
you to plan your purchasing decisions.
To give you an
example, if you run a
shoe business and
you’re left with 50
pairs of shoes at the
end of the year, then
you need to calculate
their financial value
and record it in your
balance sheet.
Lease Accounting
◦ Lease accounting is the process by which a company records the
financial impacts of its leasing activities. Leases that meet specific
classification requirements must be recorded on a company’s
financial statements. Here’s a brief review of each financial
statement.
◦ Balance sheets track a company’s assets, liabilities, and shareholder
equity and must always balance.
Importance of lease accounting
◦ Accounting is crucial to understanding a company's financial
health; with so many facets of accounting to consider, each plays a
key role in providing financial insights that can influence
organizational strategy and guide decision-making.
◦ It’s important to understand the ins and outs of lease classification
and stay up to date on the current lease accounting standards. You
also need to know how lease accounting fits into each financial
statement so you can base decisions and strategies on accurate
financial information.
Financial Disclosure
◦ The financial world, disclosure refers to the timely release of all
information about a company that may influence an investor's
decision. It reveals both positive and negative news, data, and
operational details that impact its business.
◦ Auditors are required to express an opinion on the financial
statements as a whole. This includes the notes to the financial
statements which are an integral part of the accounts, providing
additional information on balances and transactions and other relevant
information.
Construction contract
◦ Construction contract is a mutual or legally binding agreement
between two parties based on policies and conditions recorded in
document form. The two parties involved are one or more property
owners and one or more contractors. The owner, often referred to as
the 'employer' or the 'client’,
◦ Has full authority to decide what type of contract should be used
for a specific development to be constructed and to set out the
legally-binding terms and conditions in a contractual agreement
Accounting for
Government Grants
◦ The assistance was given by the government in cash or kind with
certain specific conditions. These do not include such grants from
the government which cannot be measured reasonably. Also, the
transactions with the government which cannot be separately
identified from normal trading of the organization are not
considered as a grant.
◦ For Eg:- Receipt of cash on the sale of packaged drinking water to
railways by ‘Bisleri’.
Intangible Assets
◦ An intangible asset is an asset that is not physical in nature. 
Goodwill, brand recognition and intellectual property, such
as patents, trademarks, and copyrights, are all intangible assets.
Intangible assets exist in opposition to tangible assets, which
include land, vehicles, equipment, and inventory.
◦ Additionally, financial assets such as stocks and bonds, which
derive their value from contractual claims, are considered tangible
assets.
Depreciation Accounting
◦ In accountancy, depreciation refers to two aspects of the
same concept:
◦ The actual decrease of fair value of an asset, such as the
decrease in value of factory equipment each year as it is
used and wear, and
◦ Second, the allocation in accounting statements of the
original cost of the assets to periods in which the assets
are used depreciation with the matching principle
 Cash Flow
◦ In financial accounting, a cash flow statement, also known as
statement of cash flows
◦ Cash flow is a financial statement that shows how changes in
balance sheet accounts and income affect cash and cash
equivalents, and breaks the analysis down to operating, investing
and financing activities.
◦ Essentially, the cash flow statement is concerned with the flow of
cash in and out of the business. As an analytical tool, the statement
of cash flows is useful in determining the short-term viability of a
company, particularly its ability to pay bills.
Accounts for fixed Assets
◦ Fixed assets, also known as long-lived assets or property, plant and
equipment , are a term used in accounting for assets and property
that cannot easily be converted into cash.
◦ Fixed assets are different from current assets, such as cash or bank
accounts, because the latter are liquid assets. In most cases, only
tangible assets are referred to as fixed.
THANK YOU