FINANCIAL STATEMENTS BASED ON
PHILIPPINES ACCOUNTING STANDARDS (PAS)
STATEMENT OF FINANCIAL POSITION
INCOME STATEMENT AND ITS FORMS
STATEMENT OF CASH FLOW
DIFFERENCE BETWEEN
ACCOUNTING AND
FINANCIAL MANAGEMENT
ACCOUNTING
Accounting is a systematic and comprehensive process of
identifying, measuring, processing, classifying and
recording of financial transactions pertaining to an
economic entity.
FINANCIAL MANAGEMENT
Financial Management means planning, organizing,
directing and controlling the financial activities such as
procurement and utilization of funds of the enterprise. It
means applying general management principles to financial
resources of the enterprise.
PHILIPPINE FINANCIAL REPORTING STANDARDS
The Philippine Financial Reporting Standards
(PFRS)/Philippine Accounting Standards (PAS) are the
new set of Generally Accepted Accounting Principles
(GAAP) it is issued by the Accounting Standards
Council (ASC) to govern the preparation of financial
statements.
PHILIPPINE FINANCIAL REPORTING STANDARDS
These standards are patterned after the revised International
Financial Reporting Standards (IFRS) and International Accounting
Standards (IAS) issued by the International Accounting Standards
Board (IASB).
OBJECTIVES OF
PHILIPPINES ACCOUNTING STANDARD
It prescribes the basis for presentation of general purpose
financial statements to improve comparability both with
the entity’s financial statements of previous periods (intra-
comparability) and with the financial statement of other
entities (inter-comparability)
ORIGIN OF
PHILIPPINES ACCOUNTING STANDARD/IFRS
http://www.sec.gov.ph/wp-
content/uploads/2015/10/pf
rs-adopted-by-sec-as-of-
12312011.pdf
TYPES OF FINANCIAL STATEMENT
Statement of
Financial Position
often called the balance sheet. •Assets and their Classification
•Liabilities and their Classification
In other words, it lists the •Shareholders Equity and It’s Components
resources, obligations, and
ownership details of a
company on a specific day.
ASSETS AND IT’S
CLASSIFICATION
S
ASSETS AND IT’S
CLASSIFICATION
S
https://efinancemanagement.com/financial-accountin
g/meaning-and-different-types-of-assets
TYPES OF FINANCIAL STATEMENT
Statement of
Financial Position
often called the balance sheet. •Assets and their Classification
•Liabilities and their Classification
In other words, it lists the •Shareholders Equity and It’s Components
resources, obligations, and
ownership details of a
company on a specific day.
LIABILITIES AND IT’S CLASSIFICATIONS
Current liabilities (short-term liabilities) are liabilities that are
due and payable within one year.
Example:
Income taxes payable
Bills payable
Bank account overdrafts
Accrued expenses
Short-term loans
LIABILITIES AND IT’S CLASSIFICATIONS
Non-current liabilities (long-term liabilities)
are liabilities that are due after a year or more.
List of non-current liabilities:
Bonds payable
Long-term notes payable
Deferred tax liabilities
Mortgage payable
Capital leases
LIABILITIES AND IT’S CLASSIFICATIONS
Contingent liabilities are liabilities that
may or may not arise, depending on a
certain event.
Examples of contingent liabilities:
Lawsuits https://corporatefinanceinstitute.
com/resources/knowledge/accou
Product warranties nting/types-of-liabilities/
TYPES OF FINANCIAL STATEMENT
Statement of
Financial Position
often called the balance sheet. •Assets and their Classification
•Liabilities and their Classification
In other words, it lists the •Shareholders Equity and It’s Components
resources, obligations, and
ownership details of a
company on a specific day.
SHAREHOLDERS EQUITY AND IT’S COMPONENTS
Shareholders' equity represents the COMPONENTS:
interest of a company's shareholders in Common stock
Preferred stock
the net assets of the company.
Additional paid-up capital-common stock
Additional paid-up capital- preferred stock
This fundamental relationship is expressed in Retained earnings
Foreign currency translation reserve
the form of accounting equation.
Available-for-sale securities reserve
Cash flow hedge reserve
Assets = Liabilities + Shareholders' equity Revaluation reserve
Shareholders equity = Assets - Liabilities Treasury shares
Non-controlling interest (also called minority
interest)
TYPES OF FINANCIAL STATEMENT
Statement of
Financial Position
often called the balance sheet. •Assets and their Classification
•Liabilities and their Classification
In other words, it lists the •Shareholders Equity and It’s Components
resources, obligations, and
ownership details of a
company on a specific day.
