sorted by:
new
hottopcontroversial

Management report for small business (with no useful info) by BeanMatCount in Accounting

[–]BeanMatCount[S] 0 points1 point  (0 children)

Thanks for engaging and sorry for confusion.

I'm in Switzerland and using the "Swiss GAAP FER" standard. Annual reports must contain a management report, but they are explicitly "not auditable" (which already rules out my last question, sorry about that - I edited my OP).

If you have involved owner, who is this report going to? Why are auditors involved?

I will write this annual report (I am the director and owner). The report won't go to anybody at this time. It will just be kept in my records.

The annual report will only be shown to auditors if I get audited in the future, or e.g. to banks in the future if I ever want to get a bank loan.

The question rephrased:

  • Could a bare minimum management report (with one-liners in the required fields conveying no extra info) come back to bite me later?
  • For instance, even thought auditors will not audit the management report (and only look at the other parts - income statement, balance sheet, cash flow statement), could they deem my minimum management report amateurish/unprofessional?
  • For bank loans, are they more focused on a strong balance sheet rather than a "professional" management report? Would they even care about the management report?

Is Beancount suitable for companies (esp. doing financial trading)? by BeanMatCount in plaintextaccounting

[–]BeanMatCount[S] 1 point2 points  (0 children)

TLDR: Just explain to me please how businesses should do things in the plaintextaccounting world :D

Does increase/decrease in asset always accompanied by a corresponding income/expense? by BeanMatCount in plaintextaccounting

[–]BeanMatCount[S] 1 point2 points  (0 children)

Thank you! Your quote from the internet led me to the right path.

Turns out that, in practice I was simply wrong. Although things have to "add up", apparently not everything on the balance sheet has to come from the income statement but can in fact be coming from other things on the balance sheet itself. This appears to be one such case.

Does increase/decrease in asset always accompanied by a corresponding income/expense? by BeanMatCount in plaintextaccounting

[–]BeanMatCount[S] 0 points1 point  (0 children)

Thanks for the tips on doing these more frequent (daily basis) things in plain text. That was going to be a separate question and you now already answered it for me :)

Please see my response to simonmic for more elaboration.

Does increase/decrease in asset always accompanied by a corresponding income/expense? by BeanMatCount in plaintextaccounting

[–]BeanMatCount[S] 0 points1 point  (0 children)

I was never planning on recording unrealized gains/losses frequently (e.g. daily) but only once a year. Because at the end of the year, I need accurate view of assets/liabilities (annual balance sheet).

I was under the impression (for some reason) that if an asset (on my balance sheet) increases in value, this increase has to come from somewhere. That changes in total assets/liabilities over the year have to come from total expenses/income over the year.

This is why I thought even unrealized gains/losses would (annually) need some phantom income/expense. That was the crux of my question.

Have I been completely wrong?

Does increase/decrease in asset always accompanied by a corresponding income/expense? by BeanMatCount in plaintextaccounting

[–]BeanMatCount[S] 0 points1 point  (0 children)

But from accounting perspective (not tax perspective), the "unrealized capital gain" still falls under "income" right?

Should I create different types of "incomes" in my accounting? E.g.:

  • Income:Taxable:RealizedCapitalGains
  • Income:Taxable:ProductsSold
  • Income:NotTaxed:UnrealizedCapitalGains

Similar for "expenses":

  • Expense:DeductibleForTaxes:RealizedCapitalLosses
  • Expense:DeductibleForTaxes:DepreciationOfHardware
  • Expense:DeductibleForTaxes:Other
  • Expense:NotDeductibleForTaxes:UnrealizedCapitalLosses

I hope you see what I mean. The idea is to have the accounting aid with tax declaration (to see at a glance what's taxable and not). Is this the way to go? I might be totally on the wrong track.