IMBA财政会计课件英文版(ppt 52)

IMBAFinancialAccounting,Instructor:GuohuaJiang(姜国华）,UniversityofCalifornia,Berkeley(加州大学伯克利分校),田长霖，陈省身，李远哲，赵元任，张爱玲,钱颖一。MostrecentNobelPrizewinners:DanielMcFadden(2000),GeorgeAckerlof(2001),Whata“great”timeforaccounting?,Orisntit?Accounts:angelsordevils?Youmayhatethem,butyouhavetohavethem2002,theyearofaccountingEnron,Worldcom,GeorgeW.Bush,DickCheneyBlameaccountingonanything,frominvestorlossestoSaddamHusseinhidingnuclearweaponButwestaycool!,TimeMagazine:PersonsoftheYear2002:Whistleblowers,CynthiaCopperofWorldcomColleenRowleyofFBISherronWatkinsofEnron,Whenyouthinkofaccountants,whatimagecomesuptoyourmind?,TheFatherofAccounting-LucaPacioli(1445-1517),HewroteafamousmathematicsbookInonechapterheinventeddouble-entryaccountingsystemHetaughtLeonardoDaVinciperspectiveandproportionality.Theknowledgewasusedtopaint“theLastSupper”,DowJonesIndustrialAverage1930-2002,DJIA,NASDAQ1990-2002,BacktoSquareOne:DJIA1998-2002,DorDot.bomb-NASDAQ1998-2002,TheThreeMajorStockExchanges,TheRegulatorofU.S.StockMarket,SEC,theSecuritiesandExchangeCArthurLevitt,commissioner,1993-2000intheClintonadministrationNumbersGameSpeech,1998,ThecurrentSECcommissioners,WhoissueAmericanAccountingStandards,FASB:FinancialAccountingStandardsBoardSetupin1973toreplaceAccountingPrincipleBoard(APB)Anindependent,privateorganizationStandardsissuedrecognizedbySECGAAP:GenerallyAcceptedAccountingStandards7conceptstatements(principles)e.g.,No.7(February2000)Usingcashflowinformationandpresentvalueinaccountingmeasurements148statementsofstandards(rules)e.g.,No.1(December1973)Disclosureofforeigncurrencytranslationinformation,InternationalAccountingStandards,InternationalAccountingStandardsCommittee(IASC)BasedatLondonIndependentandprivatelyfundedMeanttodesignasetofworldlyacceptedaccountingstandardsMr.ShupingFengfromChineseAccountingStandardC.ukInternationalAccountingStandards41standardsuptodatee.g.,IAS2.Inventory,January1,1995,“BigFour”InternationalAccountingFirms,ErnstYoung(worldwiderevenue2002:$10.1billions,4.3billionsintheU.S.)PriceWaterhouseCoopersDeloitteotherwisewesell.FrankelandLee,JournalofFinance,1999Togetpapersmentioned,fromaPKUcomputer,orjustaskfromme.,Howimportantisaccountinginformation?,January22,2003,aftermarketclosed,ATthisactisnotabusinesstransaction,itisfamilyaffair.Butifhegivestoaneighborsniece,itisabusinesstransaction.Itiscalledpromotion.,Reliabilityprinciple(objectivityprinciple),Accountingnumbers1)shouldbeverifiable,and2)canbeconfirmedbyanindependentobserver.Examplesofunreliablenumbers:MensweightWomensageNumberofyearsaPh.D.takestofinishhisdegreeCEOspayEnronsearnings,HistoricalCostPrinciple,Allacquiredassetsshouldberecordedattheiractualcost,I.e.,theamountofmoneypaidtoobtaintheasset,eventhoughthecostofthesameassettodayisdifferent.Why?Historicalcostisreliable.,Going-concernconcept,Itislikepeopleinthepastwhowishanemperorlivesforever,weassumecompaniesliveforever,althoughtheytendtodiefast.Why?Becauseifweassumegoing-out-of-businessconcept,manywiredthingswillhappen.1)Assetsneedtoberecordedatcurrentmarketprices2)Liabilitieswillhavetoberepaidrightaway3)EarningsandbookvaluesdonotmatterGoing-out-of-businessistheexception,nottherule.,Stable-of-monetary-unitconcept,Onedollartoday=OnedollartomorrowWhy?PurchasingpowerchangesduetoinflationordeflationButweareok.Ifthechangeinpricelevelisnottoodramatic,weholdthestable-of-monetary-unitconcept.Otherwise,everyaccountwillhavetobeadjustedeveryquarter.,Conservatismprinciple,Thetensionbetweencreditorsandshareholdersandthetensionbetweenshareholdersandmanagementdictatethataccountingisconservative.Reportbadnewsinfinancialstatementsasearlyandascompleteaspossible;reportgoodnewsinfinancialstatementsonlyaftertheuncertaintysurroundingthegoodnewsisresolved.,Conservatismprinciple-examples,ResearchanddevelopmentexpendituresAdvertisingexpenditureOtherpromotionexpendituresRelationshipbuildupcostsAlltheseexpenditureswilllikelygeneratefuturebenefitsforthefirm.Buttheyareexpensed,notcapitalizedasassetsonbalancesheetbecausetheirbenefitsareuncertainandhardtomeasure.,AccrualAccounting,Revenue:recognizewheneveritisearned,notwhencashchangeshandsExpense:recognizewheneveritisincurred,notwhencashchangeshands,FinancialStatements,BalanceSheet:atapointintime,i.e.,December31,balancesheetmeasureshowmuchassetthecompanyown,howmuchdebtthecompanyowe,andhowmuchequityshareholdershaveinthecompanyAssets=Liabilities+EquityIncomeStatement:duringtheperiodendingonthebalancesheetdate,i.e,duringtheyear,howmuchrevenuesthecompanygenerates,howmuchexpensesareusedtogeneratetherevenues,andtheearnings(RevenuesExpenses).Profitsincreaseequityonbalancesheet,whilelossesdecreaseequityonbalancesheet.StatementofRetainedEarnings:Beginningequity+EarningsDividends=Earningsequity(onbalancesheet),Whataccountsgowhere?,BalanceSheetaccounts:1)canandcanonlybemeasuredatapointintime,2)physicallyorquasi-physicallyexist,and3)canbecarriedoverandusednextperiodIncomeStatementaccounts:2)canandcanonlybemeasuredinanintervaloftime,2)doesnotphysicallyexist,and3)cannotbecarriedovertonextperiod,FinancialStatements,StatementofCashFlowsCashisking.Threesections:Operating,Investing,FinancingOperating:cashflowsrelatedtothenorma