Professional Documents
Culture Documents
BUDGETS
Budget Planning and control tool that reflects a firm’s
expected sales revenues, operating expenses, and
cash receipts and outlays.
• Preparation is generally time-consuming, involving
people
throughout the organization.
• Cash budget Tracks the firm’s cash inflows and
outflows.
INTERNATIONAL ACCOUNTING
• Global firms must translate financial statements of the
firm’s international affiliates, branches, and
subsidiaries and convert data about foreign currency
transactions to dollars.
Exchange Rates
• Ratio at which a country’s currency can be exchanged
for other currencies.
• Consolidated financial statements must reflect gains
and losses due to changes in exchange rates.
• Can have significant impact on financial statement.
• Over a recent three-year period, foreign currency
adjustments effectively added more than $1.5 billion
to Procter & Gamble’s earnings.
International Accounting Standards
• International Accounting Standards Committee (IASC)
promotes
worldwide consistency in financial reporting practices.
• Working to create one worldwide set of accounting
rules.