Accounting for Financial Services
Accounting for Financial Services, Accounting for Financial Services (AFS)
Accounting for Financial Services, Accounting for Financial Services (AFS), Accounting for Financial Services, Accounting for Financial Services (AFS), AFS study materials, short notes of accounting, Trend Analysis, IFRS, Closing entries, Suspense Account, GAAP, financial statements, Owners Equity, Matching Principles, Rebate on Bills Discounted, Online Banking
List of Short Notes of Accounting for Financial Services (AFS):
What is Trend Analysis?
A trend analysis is a method of analysis that allows traders to predict what will happen with a stock in the future. Trend analysis is based on historical data about the stock's performance given the overall trends of the market and particular indicators within the market.
Trend analysis is the widespread practice of collecting information and attempting to spot a pattern. In some fields of study, the term "trend analysis" has more formally defined meanings.
Although trend analysis is often used to predict future events, it could be used to estimate uncertain events in the past, such as how many ancient kings probably ruled between two dates, based on data such as the average years which other known kings reigned.
What is the IFRS in accounting?
The International Financial Reporting Standards, usually called the IFRS Standards, are standards issued by the IFRS Foundation and the International Accounting Standards Board (IASB) to provide a common global language for business affairs so that company accounts are understandable and comparable across international boundaries. They are a consequence of growing international shareholding and trade and are particularly important for companies that have dealings in several countries. They are progressively replacing the many different national accounting standards. They are the rules to be followed by accountants to maintain books of accounts which are comparable, understandable, reliable and relevant as per the users internal or external. International Financial Reporting Standards (IFRS) are a set of international accounting standards stating how particular types of transactions and other events should be reported in financial statements. IFRS are issued by the International Accounting Standards Board (IASB), and they specify exactly how accountants must maintain and report their accounts. IFRS were established in order to have a common accounting language, so business and accounts can be understood from company to company and country to country.
What is Closing entries?
Closing entries are those journal entries made in a manual accounting system at the end of an accounting period to shift the balances in temporary accounts to permanent accounts.
Examples of temporary accounts are the revenue, expense, and dividends paid accounts. Any account listed in the balance sheet (except for dividends paid) is a permanent account. A temporary account accumulates balances for a single reporting period, whereas a permanent account stores balances over multiple periods.
For example, a closing entry is to transfer all revenue and expense account totals at the end of a reporting period to an income summary account, which effectively results in the net income or loss for the period being the account balance in the income summary account; then, you shift the balance in the income summary account to the retained earnings account. As a result, the temporary account balances are reset to zero, so that they can be used again to store period-specific amounts in the following accounting period, while the net income or loss for the period is accumulated in the retained earnings account.
What is a Suspense Account?
A suspense account is an account in the general ledger in which amounts are temporarily recorded. The suspense account is used because the proper account could not be determined at the time that the transaction was recorded. When the proper account is determined, the amount will be moved from the suspense account to the proper account.
A suspense account is the section of a company's books where it records its unclassified debits and credits. The suspense account temporarily holds these unclassified transactions while the company makes a decision about their classification. Transactions in the suspense account continue to appear in the general ledger for the company.
What are the GAAP financial statements?
GAAP (generally accepted accounting principles) is a collection of commonly-followed accounting rules and standards for financial reporting. The acronym is pronounced "gap." GAAP specifications include definitions of concepts and principles, as well as industry-specific rules.
Generally Accepted Accounting Principles, also called GAAP or US GAAP, is the accounting standard adopted by the U.S. Securities and Exchange Commission (SEC). While the SEC has stated that it intends to move from US GAAP to the International Financial Reporting Standards (IFRS), the latter differ considerably from GAAP and progress has been slow and uncertain.
What is Owners Equity?
Owner's equity is one of the three main components of a sole proprietorship's balance sheet and accounting equation. Owner's equity represents the owner's investment in the business minus the owner's draws or withdrawals from the business plus the net income since the business began.Mathematically, the amount of owner's equity is the amount of assets minus the amount of liabilities. Since the amounts must follow the cost principle the amount of owner's equity does not represent the current fair market value of the business. Owner's equity is viewed as a residual claim on the business assets because liabilities have a higher claim. Owner's equity can also be viewed as a source of the business assets.
What is the Matching Principles?
The Matching Principle states that all expenses must be matched in the same accounting period as the revenues they helped to earn. In practice, matching is a combination of accrual accounting and the revenue recognition principle.In accrual accounting, the matching principle states that expenses should be recorded during the period in which they are incurred, regardless of when the transfer of cash occurs. Conversely, cash basis accounting calls for the recognition of an expense when the cash is paid, regardless of when the expense was actually incurred. If no cause-and-effect relationship exists, costs are recognized as expenses in the accounting period they expired: i.e., when have been used up or consumed.
The matching principle allows for a more objective analysis of profitability. By recognizing costs in the period they are incurred, a business can see how much money was spent to generate revenue, reducing "noise" from timing mismatch between when costs are incurred and when revenue is realized.
What is Rebate on Bills Discounted?
Rebate on Bills Discounted is also known as Discount Received in Advance, or, Unexpired Discount or, Discount Received but not earned. Its treatment is same as we do in the case of Interest Received in Advance.
What is Online Banking?
Online banking, also known as internet banking, e-banking or virtual banking, is an electronic payment system that enables customers of a bank or other financial institution to conduct a range of financial transactions through the financial institution's website. The online banking system will typically connect to or be part of the core banking system operated by a bank and is in contrast to branch banking which was the traditional way customers accessed banking services.
To access a financial institution's online banking facility, a customer with internet access will need to register with the institution for the service, and set up a password and other credentials for customer verification. The credentials for online banking is normally not the same as for telephone or mobile banking. Financial institutions now routinely allocate customers numbers, whether or not customers have indicated an intention to access their online banking facility. Customer numbers are normally not the same as account numbers, because a number of customer accounts can be linked to the one customer number. Technically, the customer number can be linked to any account with the financial institution that the customer controls, though the financial institution may limit the range of accounts that may be accessed to, say, cheque, savings, loan, credit card and similar accounts.
List of subjects for Junior Associate of the Institute of Bankers, Bangladesh (JAIBB) Exam:
1. Principles of Economics & Bangladesh Economy (PBE).
2. Business Communication (BC).
3. Laws and Practice of Banking (LPB).
4. Organization & Management (OM).
5. Accounting for Financial Services (AFS).
6. Marketing of Financial Services (MFS).
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Diplomaed Associate of the Institute of Bankers, Bangladesh (DAIBB)
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