imported>Doug Williamson |
imported>Doug Williamson |
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| ''Financial reporting''.
| | (PBIT). |
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| (P&L or PL or PNL).
| | A measure of the operating profitability of a business, before taking account of the effects of either: |
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| | i. The chosen capital structure; or |
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| 1. ''Primary financial statements.''
| | ii. Taxation. |
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| A profit and loss account is a primary financial statement, also known as an ''income statement'', or ''statement of profit or loss''.
| | The purpose of the measure being to facilitate comparability of underlying businesses. |
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| It shows the revenues earned in a period, matched with the expenditures incurred in the same period, to arrive at a figure of net profit or loss ''for that period''.
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| Under the 'double entry' accounting convention, income items in the Profit and loss account are Credits (CR) and expenses are Debits (DR).
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| A net profit is a Credit in the Profit and loss account.
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| A net loss is a Debit in the Profit and loss account.
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| Under International Accounting Standards, the profit and loss account is superseded by the ''Statement of profit or loss and other comprehensive income''.
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| 2. ''Balance sheet account - reserves.''
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| The profit and loss account is also another name for the ''Profit and Loss reserve'' in the balance sheet. | |
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| Like all other accounts in the balance sheet, this shows the cumulative position, incorporating ''all'' periods from the establishment of the entity up to the balance sheet date.
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| Net profits or losses <u>for the single period</u> in the primary statement feed through in turn to the Shareholders' funds (<u>cumulative</u> retained profits or losses) in the 'bottom half' - reserves section - of the Balance sheet (as <u>at the end of the period</u>).
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| == See also == | | == See also == |
| * [[Accruals concept]] | | * [[Interest cover]] |
| * [[Attributable profit]] | | * [[Net operating profit after tax]] |
| * [[Balance sheet]] | | * [[Operating profit]] |
| * [[Cash flow statement]]
| | * [[Return on capital employed]] |
| * [[Credit balance]]
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| * [[Debit balance]]
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| * [[Environmental profit and loss]]
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| * [[Financial reporting]]
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| * [[Financial statements]] | |
| * [[Income statement]]
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| * [[International Accounting Standards]]
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| * [[Loss]]
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| * [[Profit]]
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| * [[Profit and Loss reserve]]
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| * [[Statement of profit or loss and other comprehensive income]]
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| [[Category:Accounting,_tax_and_regulation]]
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