International Financial Reporting

A basic knowledge of accounting and financial statements is necessary for a chemical professional to be able to analyze a firm s operation and to communicate with accountants, financial personnel, and managers. Financial reports of a company are important sources of information used by management, owners, creditors, investment bankers, and financial analysts. All publicly held companies are required to submit annual reports to the Securities and Exchange Commission. As with any field a certain basic nomenclature is used to be able to understand the financial operation of a company. It should be emphasized that companies may also have their own internal nomenclature, but some terms are universally accepted. In this section, the common terminology is used. 

The GAAPs, developed and agreed upon by accountants, provide the rules that cover financial accounting rather than other types of accoxmting such as tax accounhng. In relahon to a pharmacy, financial accoimhng develops financial statements that report the pharmacy s overall performance to internal and external users. 

A financial statemenf is a reporf developed by the accounting department for both internal and external users. Numerous statements are developed by way of journal and ledger enfries. However, a firm uses four major financial statements to report its financial condition ... 

This chapter introduced the basic elements of accounting, which readers are likely to encounter in industry. From accounting records and internal reports, the financial data ultimately become part of the balance sheet or the income statement. The various tenns in the balance sheet and the income statement were defined, and an illustration of these documents for a typical company was presented. This information should allow readers to determine how well a company has done and is doing. All annual reports contain footnotes, which explain how changes in the financial infonnation and pending litigation could affect the financial performance of the company. The lOK report was mentioned because it provides the source of the detailed backup financial information not in the annual report. 

Industry Studies. Companies are racing to become more international, if not global in their strategies. For over 2000 product/industry categories, these reports give the reader a concise summary of latent market forecasts, pro-forma financials, import competition profiles, contacts, key references and trends across 200 countries of the world. Some reports focus on a particular product and region (up to four regions per product), while others focus on a product within a particular country. 

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