| A | B |
|---|
| Accounting | The process by which information is identified, measured, recorded and communicated through reports to users so that they are able to make inform judgements. |
| Assets | The economic resources of an entity. |
| Capital expenditure | Expenditure incurred, in one financial year, which will benefit multiple accounting periods. |
| Contributed capital | Funds or resources contributed to the entity by the owners. |
| Entity | An area of economic interest belonging to a particular individual or group. |
| Equity | The net worth or the owner's financial interest in the entity. |
| Expenses | The cost incurred in producing income for a particular accounting period. |
| Financial performance | The extent to which income exceeds the operating costs of an entity in achieving its objectives. Increases in entity are an indicator of the entity's financial performance. |
| Liabilities | Claims on assets of an entity by people other than the owners of the entity. |
| Retained accumulated profits | Accumulated surpluses or profits. That is, the excess of operating revenue over the cost which have not been distributed to the owners. |
| Revenue | Earnings from the provision of goods and services. |
| Revenue expenditure | Expenditure which is charged to the current accounting period because the benefits from it will be consumed in the current period. |
| Surplus | The excess of revenue over expenditure for a particular period. |
| Accounting period concept | This is where the life of an entity is split into equal periods so that comparable financial statements can be compiled. |
| Entity concept | This concept draws a boundary around the entity being accounted for. This means the transactions of each entity are accounted for separately from the other entities. This concept leads to the derivation of the accounting equation. |
| Going concern concept | It is assumed that the entity will continue in operation beyond the current period. |
| Matching concept | This concept requires income to be recognised in the accounting period in which the benefits accrue to the entity. Operating costs incurred in deriving that income are recognised in the same accounting period. |
| Monetary concept | Tjis concept enables unlike terms to be recorded in a common denominator, the dollar, so that they can be included in the financial statements. |
