Chapter 13 - UK GAAP

Question 1

1. How do companies prepare financial statments under UK GAAP laws
2. Who are responsibile for issuing UK accounting stadards?

Answer 1

1. Assets - liability = capital
2. The financial reportinbg council (FRC)

Question 2

What documents are required in financial statments?

Answer 2

• Profit and loss account _{<em>(SPL)</em>}
• A balance sheet_{<em> (SFP)</em>}
• A directors report
• An auditors report (if accounts audited)

Question 3

GIve the UK GAAP terminology for the following international accounting terms

Answer 3

Question 4

How is a balance sheet formated? _{<em>(SFP)</em>}

Answer 4

• Top part → Shows total net assets

→ (fixed assets + current assets- current liabilities - long term liabilites)

• Bottom part → shows sharholder funds

→ Share capital + reserves

Question 5

How is the profit and loss account formated?

Answer 5

(very similar to SPL)