Select a company that you can visit in person or interview onthe phone. Call a h
ID: 2434148 • Letter: S
Question
Select a company that you can visit in person or interview onthe phone. Call a head to the company to arrange a time when youcan interview an employee (preferably an accountant) who helpsprepare the annual financial statements. Inquire about thefollowing aspects of its accounting cycle:
1. Does the company prepareinterim financial statements? What time period(s) is used forinterim statements?
2. Does the company use thecash or accrual basis of accounting?
3. Does the company use awork sheet in preparing financial statements? Why or why not?
4. Does the company use aspreadsheet program? If so, which software program is used?
5. How long does it takeafter the end of its reporting period to complete annualstatements?
Explanation / Answer
1. Does the company prepare interim financial statements? What timeperiod(s) is used for interim statements?
Yes. As per SEBI, Quarterly Financial stt are reqd to be prepared& sent to stock exchange & share holders/public
2. Does the company use thecash or accrual basis of accounting?
Accrual basis of accounting
3. Does the company use a worksheet in preparing financial statements? Why or why not?
No. All journal entries are made online in the Financial SW. Thiseliminates rework & also gives an updated & day by daystatus of the Financials.
4. Does the company use aspreadsheet program? If so, which software program is used?
No. However MS Excel can be used by those who doesnt have a fullfinancial package
5. How long does it take afterthe end of its reporting period to complete annual statements?
As all transactions are recorded in teh financial package, at anypoint of time the financial statements can be prepared. HoweverAuditors also need to check teh entries with Bankstts/invoicing/receivables tc which takes some time. However aprudent firm can declare its statements within a week of quarterclosing.
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