Dfs

Ok so i am going through the preparation of the accounts for Ltd companies
i need to prepare income statement , statement of financial position , statement of changes in equity, etc etc etc

my question is:

Will i be marked down if i state Profit and Loss account instead of income statement and Balance sheet instead of statement of financial position?

Are they the same, just different ways of calling it?

I am used to write the words P&L and BS against each entry of a Trial Balance so i know where the different things go so i am thinking what if i do that at the exam??? will i be penalised?

Marga

Comments

  • Steve Collings
    Steve Collings Registered Posts: 997
    Hi,

    You could well be marked down because you are not referring to the correct terminology in IAS 1.

    It is much better to forget the UK terminology when studying and apply the correct terminology in the exam room. I know how difficult it is sometimes to get out of the habit of referring to P&L and balance sheet (I frequently cite those names when lecturing, when I should not), but it's not worth risking marks for something so easy to apply.

    Regards
    Steve
  • Marga
    Marga Registered Posts: 981
    Hi,

    You could well be marked down because you are not referring to the correct terminology in IAS 1.

    It is much better to forget the UK terminology when studying and apply the correct terminology in the exam room. I know how difficult it is sometimes to get out of the habit of referring to P&L and balance sheet (I frequently cite those names when lecturing, when I should not), but it's not worth risking marks for something so easy to apply.

    Regards
    Steve


    Thanks Steve ,

    Am i right in saying that for sole traders and partnerships we can then use P&L and BS terminology beccause they dont follow the standards?
  • Monsoon
    Monsoon FMAAT, AAT Licensed Accountant Posts: 4,071 ? ? ?
    Can I just slightly hijack this? I'm confused as to the new standards - from the way everyone is talking, it's like calling stock 'inventories' etc is new.

    We had to switch over to this way of terminology (inventories, receivables, payables etc, though I don't remember 'statement of financial position') back in 2005-06 when I was studying Technician, so why is it 'new' now?

    I know there is a shift to IAS generally, but I thought the AAT implemented the new terminology years ago.
  • blobbyh
    blobbyh Registered Posts: 2,415
    Yes, but if you've been in accounts for years and calling them P&L and BS for most of those yet only doing your formal exams now, it's gonna be hard to change the habits of a lifetime.

    I've only been in accounts for just over five years and also did DFS in 2006 but I still call it a P&L and Balance Sheet. No doubt those terms will exist in Industry for many years to come. If I said the words 'Income Statement' to my ACA qualified Finance Director - who should know better herself but it's that old habits malarkey again - I'd get looks like I've just had a dump in her handbag.

    It might be correct but it'll be a long time before it's widely accepted as right!
  • Monsoon
    Monsoon FMAAT, AAT Licensed Accountant Posts: 4,071 ? ? ?
    Oh I agree, I translated normal language into this stupid stuff for the exams and then went right back to speaking normally again :laugh:
  • Marga
    Marga Registered Posts: 981
    ohhhhhhhhhhh i am loving DFS!!! cant believe i didnt start this before ..... definetely better than MAC and more interesting!
  • Becky V
    Becky V Registered Posts: 374
    Marga wrote: »
    ohhhhhhhhhhh i am loving DFS!!! cant believe i didnt start this before ..... definetely better than MAC and more interesting!

    I dont mind the first bit the statement of income and statement of financial position, but the cash flow im trying to get my head round!!
  • Marga
    Marga Registered Posts: 981
    Becky V wrote: »
    I dont mind the first bit the statement of income and statement of financial position, but the cash flow im trying to get my head round!!

    oh that is the one i am liking the most!
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