When it comes to bank payments and someone else doing them or you being in control of bank payments in someone else’s company, surely you’d want someone to also review the payments.
Bank is an entity holding the company’s funds and as they’re used, the company is giving away its resources – being responsible for this process means that you can also be held liable if something goes wrong, if wrong amounts are paid, if wrong parties are paid to and so on. Continue reading
With bonuses to employees it’s important to remember one simple rule – they’re always supposed to be expensed within the reporting period they relate to. I know it’s obvious, but for some reason the mistakes happen often enough to have this explained further. There are questions people struggle with and hence it seems safer to recognize the bonuses within the period they are either paid out or when the answers are definite. Continue reading
Not always what you estimate works out the way you initially thought. An estimate in essence is “estimating” or “guessing” what might happen based on the information you have at your disposal at the time you’re making the estimate into your accounts. Continue reading
Reporting your inventories on statement of cash flows is virtually always done under operating activities cash flows. When you think about it, what are operating cash flows in essence? They’re meant to show the flows your business is able to generate from its operations, from its day-to-day activities. So it’s safe to say that inventories are something that fall under this category pretty clearly. Continue reading
Say there’s a situation where you consider a receivable being doubtful, you write it down and after a while your customer still pays the balance. How would you treat such a transaction in your accounting? Continue reading
Sometimes it happens so that you are unable to collect the receivable and as it happens, you should consider writing it down. Whenever your client has financial difficulties, it’s one of the conditions that should make you doubt the ability of the customer to actually pay up what they owe. Continue reading
Making a sale happen is one thing. You’ve accounted for the receivable from the sale, that’s another thing. Getting paid for the sale and collecting the receivable is entirely another matter. In one of our examples we accounted the receivable and we’ve been lucky enough that our client actually owned to what they had to pay and that’s what they did. Continue reading