Auditors examine a client’s records to ensure they meet specific criteria. Usually, it includes the financial statements backed by the general ledger. Sometimes, auditors disagree with some entries passed in the client’s records. In these cases, auditors may provide some adjustment entries to the client, known as audit adjustment. What …

Determining how long a piece of equipment or inventory will last in the stock can be very important. In some businesses, it can make a difference in whether the company can meet customer demands. Hence, Days of Inventory on Hand (DIH) is a very useful calculation. Understanding Days of Inventory …

The primary objective of audits is for the auditors to provide a report on a given subject matter. This report contains the auditor’s opinion of whether the subject matter includes material misstatements. Depending on the type of audit engagement, it may also provide other conclusions. Auditors base their opinion on …

Trust is not a profitable option when it comes to business. Landlords, creditors, and others will require a company to put its money or other assets where its mouth is by signing a lease. This legally binding document outlines the terms of the agreement, including the amount of rent, length …

A bond is a debt instrument that allows the issuer to obtain debt from third parties. Usually, companies and government bodies issue these instruments. When a buyer acquires a bond, they pay its market value to the issuer. After that, the buyer holds the bond for a period during which …

Gross income is an important aspect when it comes to finances and taxes. It’s the amount that an individual earns in a year from all sources before any taxes or deductions are taken out. This includes income from wages, salaries, tips, interest, and other forms of income. Gross income is …

Auditors collect sufficient appropriate audit evidence to provide their opinion on a subject matter. Based on this opinion, users can make various decisions. Therefore, auditors must consider the trust users put in their work. If auditors fail to perform their tasks effectively, they may face legal repercussions. These fall under …

When it comes to the corporate world, the term “subsidiary” gets used a lot. And there are different types of subsidiaries, each with its purpose and definition. But the most common type of subsidiary is a wholly owned subsidiary. A subsidiary is a company that is controlled by another company, …

Inventory is the primary source of revenue for companies that sell physical goods and products. These companies manufacture or purchase items and sell them to customers. During this process, companies must track the goods available for sale. One of the systems that companies can use to do so is the …

Income statements are very important parts of any company’s financial statements. It is a summary of a company’s revenues and expenses over a particular period, usually one fiscal year. The statement of comprehensive income is also a part of the income statement, but it includes both standard net income and …