What is Amortized Cost? And How to Calculate It?

Amortized cost

Introduction The amortized cost falls under-investment category and method to accounting which requires financial assets under amortized cost method to be reported on balance sheet date at amortized cost, which should equal initial acquisition amount fewer deductions for principal repayment and adjustments amortization or impairment if any. It is a presentation category allowed by IFRS […]

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Reasonable Assurance – All Of the Important Points You Should Know

Audit

This is the deduction that financial reports aren’t materially misstated. It is a high-level guarantee but no guarantee. It includes the understanding that there is a remote likelihood that material misstatements will not be detected or prevented on time. Reasonable assurance is the assurance level auditors are required to acquire by the execution of audit

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Deferred Tax Assets – Definition, Example, and Why the Deferred Tax Asset Arises

Financial Statements, Tax

Definition: Deferred tax asset arises when differences exist between the taxable income and actual income of a company. In other words, it is the amount of money the IRS owes to you because your taxable income was higher than your actual income for a particular accounting period. Hence, you paid higher taxes than you reported

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Management Responsibilities Related to Fraud – Main Responsibilities You Should Know

Audit

In the modern-day and age, it is increasingly important for the management to have strong internal controls to mitigate the overall risk of fraud or errors within the company. Managers need to have a foolproof strategy to ensure that their controls and SOPs (Standard Operating Procedures) do not impose any inherent risk because it might

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Inherent Limitations of An Audit: The Main Limitation You Should Know

Audit

Introduction: As per the International Standards of Auditing (ISA), an auditor’s responsibility is to provide reasonable (high level) assurance to the users of financial statements that the financial statements are free from material misstatement. A high level of assurance is not an absolute level of assurance – which can’t be obtained due to the inherent

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Financial Accounting: Definition, Uses, Characteristics, and Importance

Financial Accounting

Definition: Accounting can be described as the recording, controlling, reporting, and analyzing of an entity’s business transactions that occur every day so that the related stakeholders could use that financial information for their own interest. It is the channel through which parties interested in the business that is both the shareholders and stakeholders share information

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Auditors Responsibilities on Financial Statements (Explained)

Audit, Financial Statements

The process of getting financial statements audited is a really important step in lieu of ensuring that the organization has presented true and fair view of their financial position over the past year. Therefore, the responsibility of an auditor to provide assurance on that particular claim is quite significant, since it really impacts the overall

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Management Responsibilities on Financial Statements (Explained)

Financial Statements

Financial Statements are very important and useful tools when it comes to measuring the overall performance of the company across a given time frame. There are numerous stakeholders which make use of the financial statements, essentially because of the fact that they provide a snapshot regarding the company’s performance in shorter time duration. As a

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