Accounting and Finance Research Paper

Introduction

Financial reporting comprises of financial information disclosure to the management and public in regard to the company’s performance in a given period. For the company, the procedures used follows the basic guidelines established in preparation of various financial statements in businesses especially public companies. The reporting procedures are based primarily on accounting cycle, indicating the manner in which financial information including costs, sales and forecasts flows in the organization.

Reporting Procedures

The cost reports for the company are prepared on the basis of both direct and indirect costs.  Reporting cost for the company is done every time the overall reporting is being done at a specified period for the financial year. The various cost incurred in the operations of the company are prepared on cost statements that includes direct and indirect expenses. Such a statement is used to record cost of various items such as labor costs, sales and administration expenses and especially the cost of goods. In the income statement, the cost statement indicates the amounts paid during different periods to creditors including retailers and wholesalers. The preparation of such statements follows the basic guidelines and established standards. Following established standards while reporting on costs removes any hitches that may arise from incorrect or incomplete statements that may in turn affect provision of such information to users (Hribar, Kravet & Wilson, 2014). Reports on sales are done immediately and include the sales made, any returns and those orders that have been cancelled. Forecasts reports involve the expected futures sales for the products of the firm. These reports are prepared on monthly and yearly basis to show orders and value of sales made.

Payroll Policies and Procedures

The firm’s employees are paid on semi-monthly and monthly basis and this depends on their position. The payment method used in the company is direct deposit and all new employees have to sign up for this method. The employee’s portfolio contains information about the payroll statements.  The preparation of the statements is done in consideration of mandatory deductions and this includes optional deductions after taxation of the salary. Direct deposit system of payment is efficient since it saves on amount of time taken preparing payrolls (Bragg, 2011). The Human Resource manager administers the payroll for entire firm.

Budget Process

Developing an annual budget is usually among the most important activity of management since it has great impacts on employees, operational performance and equipment needs and development scope. This process starts with communication from managers on required objectives or goals and then matter is taken over by accounts department through budget director. The process starts in October and ends in November in every year. The process includes a forecast for the following year and this takes time. In budgeting process, time is a very costly aspect since an effective forecasting may take much of the time (Bierman & Smidt, 2014).

Measure of Financial success

The firm uses various factors to measure the financial success which includes liquidity, operations efficiency and profitability. Liquidity shows the firm can pay short-term debts while operating efficiency indicates ability to control costs during operations. Profitability is major indicator for success.

Conclusion

The procedure for financial reporting for the company involves preparation of statements on the basis of established accounting standards and internal policies. The annual budgeting process for the firm is initiated by management through communication of desired objectives. Financial success is measured through liquidity, operations efficiency and profitability.

Reference

Bierman Jr, H., & Smidt, S. (2014). Advanced capital budgeting: Refinements in the economic analysis of investment projects. Routledge. 67

Hribar, P., Kravet, T., & Wilson, R. (2014). A new measure of accounting quality. Review of Accounting Studies, 19(1), 506-538.

Bragg, S. M. (2011). The New CFO Financial Leadership Manual. New York, NY: John Wiley & Sons.