Reporting Practices and Ethics

Reporting Practices and Ethics Paper
Maryann Bocak
November 21, 2011
David W. Catoe

Reporting Practices and Ethics Paper
For any business, there are four basic financial statements or reports, which are a must or the business to be able to survive. They include the Balance Sheet, the Statement of Revenue and Expense, the Statement of Fund Balance or Net Worth, and the Statement of Cash Flows (Baker, 2011).
The Balance Sheet records what an organization owns, what owes, and what it is worth. The total of what the organization owns, its assets, will equal the combined total of what the organization owes and what it is worth. Assets will include current assets, property, plant and equipment other assets. Current assets are supposed to be convertible into cash within one year. Property, plant and equipment represent the long-term assets. Liabilities are those reflected as current liabilities, and long-term debt. The current liabilities are items the corporation will pay within the next year, while long-term debt covers many years. The amount of long-term debt due within the next year should be deducted from the long-term debt amount and moved to the current liabilities section (Baker, 2011).
The Statement of Revenue and Expense covers a specific period for the organization. The statement reflects the operating revenue less expenses results in the operating income for the organization. If the revenue exceeds the expenses, the statement will reflect a positive outcome. If the expenses exceed the revenue, the statement will reflect a loss and a year that was not profitable (Baker, 2011).
The Statement of Changes in Fund Balance/Net Worth reflects the operating revenue that is excess flowing back into equity or the fund balance. This statement links the balance sheet, the statement of revenue and expenses (Baker, 2011).
The Statement of Cash Flow takes the accrual basis statement and converts them to a cash flow for the period through a series of...