Provision | Meaning, Objective

A provision is the sum of amount set aside by charging against the profit ans loss account. It is created for meeting a known loss or liability. It is maintained for meeting an anticipated loss or liability of uncertain amount.  Meaning of Provision Search amount of anticipated loss liability can only be estimated. If the present … Read more

What is Secret Reserve? Meaning, Objective, Advantages, Disadvantages

Definition of Secret Reserve A secret reserve refers to a reserve created by a company by understating its assets or overstating its liabilities in its financial statements. This reserve is not disclosed in the financial statements but is kept secret from external parties such as shareholders, creditors, and tax authorities. The purpose of creating a … Read more

What is statement of expenditure

The new government accounting system requires an operating level office to regularly report on expenditures to the concerned central level office. For this purpose, a number of reports are prepared in the form of statements and submitted to the concerned central-level office. For this purpose, a number of reports are prepared in the form of … Read more

Petty Cash Book and It’s Concept

The new government accounting system emphasizes that government transactions have to take place only through banks. In other words, all receipts and payments have to be made only by bank cheques. since banks are ordinarily not bound to pay cheques drawn for less than Rs. 100, it is, however, not worthwhile to draw cheques of … Read more

Reserve and It’s Concept

A business has to face several known and unknown contingencies and losses. There may be, for example, a decline in profits or occurring of losses, needs for replacing assets, rise and fall in the value of assets, fluctuations in price and exchange rates, and change in fashion and technology.  These contingencies may adversely affect the … Read more

Single Entry System and It’s Meaning

Concept Of Single Entry System There are different forms of business concerns. Some of these concerns are small traditionally run and legally not required to maintain their books of accounts under a particular accounting system. Generally, a small sole trading concern run by the not well-educated owner having no idea of a modern accounting system … Read more

Non-Trading Concerns and It’s accounts

Concept of Non-Trading Concerns There are many concerns that have the main motto of rendering services instead of making profits. Such concerns are call non-trading of non-profit-making concerns. Examples of such concerns include different types of clubs, schools, colleges, hospitals, libraries, Guthies, professional associations, and unions.  These concerns render services to their members and to … Read more