Accounting Financial Summary Quiz

Accounting Financial Summary

• A balance sheet is a summary of the financial balances of an individual or organization, listing assets, liabilities, and ownership equity as of a specific date.
• Of the four basic financial statements, the balance sheet is the only one that applies to a single point in time.
• A standard company balance sheet has two sides, assets on the left and financing on the right, which has two parts: liabilities and ownership equity.
• The difference between assets and liabilities is known as equity or the net assets or the net worth or capital of the company.
• Total assets equal liabilities plus owner's equity.
• There are two forms of balance sheets: report form and account form.
• Personal net worth is the difference between an individual's total assets and total liabilities.
• A small business balance sheet lists current assets, fixed assets, intangible assets, and liabilities, with equity as the difference between total assets and total liabilities.
• Guidelines for balance sheets of public business entities are given by the International Accounting Standards Board and various country-specific organizations.
• Balance sheet substantiation is the accounting process conducted by businesses to confirm that the balances held in the primary accounting system of record are reconciled with the balance and transaction records held in the same or supporting sub-systems.
• Balance sheet substantiation includes multiple processes, including reconciliation, review, and formal certification.
• Balance sheet substantiation is a key control process in the SOX 404 top-down risk assessment.