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15 Cards in this Set
- Front
- Back
4 Aspects of a Financial Transaction
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initiation (ck request), authorization, asset custody (keeping the ck book), &
recording the transaction (posting) |
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Clean Audit
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opinion providing highest level of assurance that the Stmt of Financial Position fairly presents the orgs financial position, the Stmt of Activities fairly presents the results of the orgs ops, & the Stmt of Cash Flows farily presents its cash flows
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Unqualified Audit
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opinion providing highest level of assurance that an audit can provide with attn given to a particular matter & provides for disclosre of additioanl financial stmts provided or draws attn to an add important matter
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Strategic Program Budgeting
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allocates salaries & other overhead to know the true profitability of products & services
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Annual Audit
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Mgmt is responsible for financial reports. Auditors verify the amts in the reports. The BOD hires the auditors & receives the report. (Conflict of interest for CSE or CFO to hire auditor.)
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Sarbanes-Oxley
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2 provisions impact nonprofits: whistle-blower protection & the prohibtion of doc destruction upon the commencement of a federal investigation. Many moving to create an audit committee (w/ financially literate mbrs) & creating a code of ethics for BOD w/ BOD training & self evals.
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Essential Financial Controls
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Clear lines of authority, clear definition & acceptance of responsiblity, authority commensurate w/ responsibility, proper training
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Combined Cash & Accrual Statement
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records unpaid bills on accrual basis & uncollected income on a cash basis
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Management Letter
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issued by auditor, communicates areas that mgmt needs to address in order to comply w/ GAAP accting practices
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Reporting Capital Gains
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capitial gains or losses are reported in the unrestricted class unless there are explicit donor restrictions on the gains & an applicable state law judged by the orgs board to requre the rettention of some or all of the capital gains/ losses in the restricted class
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Stmt of Activities
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Shows orgs financial activity by the mo & on a ytd basis. Reports revenue generated, expenses incurred & results in net income or net loss.
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Stmt of Cash Flows
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Shows info re cash receipts & cash disbursements from ops, investments & financing activities during a pd of time. Helps others assess the orgs ability to generate positive future cash flow to meet obligations.
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Stmt of Financial Position (Balance Sheet)
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Summary of financial makeup at a specific pt in time. Reflects the assets, the liabilities owed by the org, & the residual net assets representing net worth.
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Accrual Accounting
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recognizes revenues when earned & expenses when incurred (gives better cash flow proj than cash basis acct)
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Cash Basis Accounting
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recognizes revenue when cash is received & expenses when cash is expended
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