Accountant Farmingdale

Accountant In Farmingdale

What is Financial Accounting and What to Look for in Farmingdale?

Garcia & Associates, C.P.A. PLLC, a trusted Nassau County accounting firm provides financial services for individuals and businesses in Farmingdale and surrounding areas. We are dedicated to three underlying principles: professionalism, responsiveness and quality. Our team of accounting professionals are happy to answer your questions about how we can be your trusted partner for all your financial accounting needs. Our accountants are known for their quality of service. When you are searching for an accountant in Nassau County call the team at Garcia & Associates, C.P.A. PLLC.

Factors to Consider when Choosing Financial Accounting Services

Financial accounting is a specialization area of accounting that keeps track of a company’s financial records and transactions. Transactions are recorded, summarized and presented in financial reports financial statements as they are related to a particular business. The information is presented to stockholders, suppliers, banks, employees, government agencies, business owners and other stakeholders of the entity of interest.

Financial accounting and financial reporting are commonly used synonymously. Nassau County businesses of all sizes can benefit from the services of a firm that specializes in this area of accounting. When looking for an accountant in Farmingdale you want to be sure they have the experience for your needs.

There are common rules known as accounting standards and generally accepted accounting principle (GAAP) since these financial statements are used by a variety of people. The Financial Accounting Standards Board (FASB) is the organization which develops the accounting standards and principles in the United States. A corporation whose stock is publicly traded must comply with the reporting requirements of the Securities and Exchange Commission (SEC) as well.

Types of Financial Statements Accountants Prepare

After careful preparation these general-purpose financial statements may be generated:

  • Income statement also known as an earnings statement or profit and loss statement (P&L)
  • Statement of cash flows also referred to as a cash flow statement
  • Statement of comprehensive Income
  • Balance sheet also referred to as a statement of financial position
  • Statement of stockholders equity

Income Statement

The income statement reports profitability of a company during a specific period of time. Main components of this statement are revenues, expenses, gains, and losses. If a corporation has publicly traded stock, the earnings per share of common stock are reported on the income statement.

Statement of Cash Flows

The statement of cash flows deals with the change in a company’s cash and equivalents during the time specified in the heading of the statement. There are three parts to this statement: 1- operating activities, 2- investing activities, and 3- financing activities.

Operating activities explains how a company’s cash and equivalents have changed due to operations. Investing activities refer to transactions involving long-term assets. Financing activities report things such as cash received through the issuance of long-term debt, stock issue, or money spent to retire long-term liabilities.

Statement of Comprehensive Income

Covering the same period of time as the income statement, the statement of comprehensive income contains two major sections:

  • Net income (taken from the income statement)
  • Other comprehensive income (adjustments involving foreign currency translation, hedging, and post-retirement benefits)

Comprehensive income is the sum of these two amounts. The amount of other comprehensive income is added/subtracted from the balance in the stockholders’ equity account Accumulated Other Comprehensive Income.

Balance Sheet

The balance sheet is organized into three parts: 

1- Assets

2- Liabilities

3- Stockholders’ equity at a specified date

The company’s assets include such things as cash, accounts receivable, inventory, prepaid insurance, buildings, and equipment. 

Liabilities are obligations that are due at the date of the balance sheet. These often include the word “payable” in their title (Notes Payable, Accounts Payable, Wages Payable, and Interest Payable). 

Stockholders’ equity is defined as the difference between the amount of assets and the amount of liabilities. 

Statement of Stockholders’ Equity

The statement of stockholders (shareholders) equity lists the changes in stockholders’ equity for the same period as the income statement and the cash flow statement. These changes will include items such as net income, dividends, other comprehensive income, repurchase of common stock, and the exercise of stock options.

An accountant in Farmingdale will be able to explain these in detail and how they affect you. When finding an accounting firm in Nassau County it is important to find an accountant who can advise you on your personal tax account as well as business. Being armed with this knowledge and experience helps them advise you better with your financial situation.

The Difference Between Financial Accounting and Other Types of Accounting

Financial accounting represents only one area in the field of business accounting. Managerial accounting is yet another area. Managerial accounting provides financial information to a company’s management. Generally this information is internal and primarily used by management to make decisions. 

There are other areas of the accounting field such as cost accounting, tax accounting, and auditing.

Looking for quality professional financial accounting near Farmingdale?

If you are looking for a trusted accounting partner in Nassau County the team at Garcia & Associates, C.P.A. PLLC is happy to take your call. Our accountants provide personal and professional attention to discuss your tax and financial situation. Please give us a call at 718-533-0300 or visit https://www.garciagroup.com and submit our online contact form.