accountancy vocabulary

What is a liability?

• An Asset

• Money someone has to pay to my company

• Money owed by a company

• A loss incurred by a company

A (_______/_____) is a Financial Statement which lists all the assets and all the liabilities of a company on

one particular day, which is very often 31st December.

My liabilities are greater than my assets, therefore my company is (i_________)

This year the company made a net loss. This statement means that the company...

• Made a surplus

• Made a loss after all expenses were deducted

• Made a profit before deductions

• Made a loss before all deductions

The company had assets of £250,000 and liabilities of £150,000 so therefore it was (s______) and the

balance sheet had a net worth of £100,000.

An I______/s________ is a Financial Statement which shows all the company’s sales and all of its costs,

for a period of time, which is normally a year and is often the year to 31st December.

D_____/E____ is the accounting system used all over the world. It was invented several centuries ago and

records every transaction twice (as a Debit and a Credit)

B__________ is the job of recording all the entries of a business in its records.

This person prepares the Financial Statements (see 5. above) from all the work that the Bookkeeper has

done. The Accountant works for the business and produces information for management in order to show

how well the firm is doing, and to help management to make decisions.

• A Bookkeeper

• A Finance Manager

• An Accountant

• The General Manager

What is an auditor?

• An employee of a company that checks their finances

• An accountant employed by the company

• A bookkeeper

• An external person who checks that a company's accounts are accurate and fair