Limited Company Financial Statements - 30%

Question 1

What is a limited liability company ?

Answer 1

-A limited liability company’s offer limited liability to their owners ( shareholder).
- they are ran by board of directors
- often have a large number of shareholders who ARE NOT involved in the day to day running of the business.

Question 2

What are the rules and regulations that a limited liability company has to adhere to when preparing financial statements ?

Answer 2

GAAP
(Generally accepted accounting practice)

Question 3

Where is the GAAP rules and regulations drawn from ?

Answer 3

• company law
• accounting standards
• IFRS
  The stock exchange

Question 4

What do the accounting standards do ?

Answer 4

Provide information as to how transaction and events should be reflected in the financial statement.

They are issued by IASB, include both IFRS and IAS