Finance: Functional & Terms

Source Reference:
http://en.wikipedia.org
http://www.investopedia.com
http://www.wikicfo.com

Ledger
The ledger is a permanent summary of all amounts entered in supporting journals which list individual transactions by date.

General Ledger(GL)
General Ledger is the final repository of the accounting records and data. In modern accounting softwares or ERP, the general ledger works as a central repository for accounting data transferred from all sub-ledgers or modules like accounts payable, accounts recievable, cash management, fixed assets, purchasing and projects. General ledger is the backbone of any accounting system which holds financial and non-financial data for an oranization.

Journals
Is a double entry bookkeeping entries are recorded by debiting one or more accounts and crediting another one or more accounts with the same total amount. 

Multiple Journal (MJ)
Used to update the project ledger and simultaneously the affected module.
Also used to add expenses or to transfer expenses into Project Costing Ledger.

Multi Ledger Journal
Used to update Project Ledger by type of ledger e.g  Cash, Actual, Commitment.

Account Receivable (AR)
Payment received by company for debtor's invoice issued.

Account Payable (AP)
Also known as Creditors; is money owed by a business to its suppliers and shown on its Balance Sheet as a liability.

Invoice
A commercial document issued by a seller to the buyer, indicating the products, quantities, and agreed prices for products or services the seller has provided the buyer

Account
A financial statement; a formal record of the financial activities of a business, person, or other entity.

Debit
A financial transaction in which one person withdraws funds from another person's bank account.
OR
Its a fundamental aspects of every financial transaction in the double-entry bookkeeping system. Every debit transaction must have a corresponding credit transaction(s)."Dr" (Debit) means left side of a ledger account.

Credit
A contractual agreement in which a borrower receives something of value now and agrees to repay the lender at some later date.
OR
Its a fundamental aspects of every financial transaction in the double-entry bookkeeping system. Every credit transaction must have a corresponding debit transaction(s)."Cr" (Debit) means right side of a ledger account.


Cash
Refers to money in the physical form of currency.
OR
In bookkeeping and finance, cash refers to current assets comprising currency or currency equivalents that can be accessed immediately or near-immediately.

Cash Book
A financial journal that contains all cash receipts and payments, including bank deposits and withdrawals. Entries in the cash book are then posted into the general ledger. The cash book is periodically reconciled with the bank statements as an internal method of auditing. 

Budget
Budget is a financial plan and a list of all planned expenses and revenues. It is a plan for saving, borrowing and spending. 


Purchase Requisition (PR)
A purchase requisition is a request sent to the purchasing department to procure goods or services. It is originated and approved by the department requiring the goods or services.

Purchase Order (PO)
PO is a commercial document issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services the seller will provide to the buyer.

Procurement Process(Perolehan)
Procurement defines as the act of buying goods and services for the government.
Procurement may also involve a bidding process i.e.,Tendering. 


Chart Of Accounts(COA)
COA is a created list of the accounts used by a business entity to define each class of items for which money or the equivalent is spent or received. It is used to organize the finances of the entity and to segregate expenditures, revenue, assets and liabilities in order to give interested parties a better understanding of the financial health of the entity.


Standard Chart Of Accounts

In accounting, a standard chart of accounts is a numbered list of the accounts that comprise a company’s general ledger. The company chart of accounts is basically a filing system for categorizing all of a company’s accounts and classifying all transactions according to the accounts they affect. The chart of accounts list of categories may include assets, liabilities, owners' equity, revenues, cost of goods sold, operating expenses, and other relevant accounts. 

Assets
Assets are economic resources.

The accounting equation relates assets, liabilities, and owner's equity:

Assets = Liabilities + Stockholder's Equity (Owner's Equity)

Assets = liabilities + Capital

liabilities = Assets - Capital

Capital = Assets - liabilities

Current Assets
Current assets are cash and other assets expected to be converted to cash or consumed either in a year or in the operating cycle (whichever is longer), without disturbing the normal operations of a business. These assets are continually turned over in the course of a business during normal business activity. There are 5 major items included into current assets:

• Cash and cash equivalents
• Short-term investments
• Receivables
• Inventory
• Prepaid expenses 

read more:http://en.wikipedia.org/wiki/Asset#Assets_in_accounting

Fixed Assets
A fixed asset is a long-term tangible asset. Fixed assets are also called non-current assets, long-term assets, or property, plant and equipment (PP&E). Fixed assets are often large and illiquid physical assets that are important to a company’s core business operations. 


Trial Balance
A trial balance is a list of all the General ledger accounts (both revenue and capital) contained in the ledger of a business. This list will contain the name of the nominal ledger account and the value of that nominal ledger account. The value of the nominal ledger will hold either a debit balance value or a credit balance value. The debit balance values will be listed in the debit column of the trial balance and the credit value balance will be listed in the credit column.


Balance Sheet
In financial accounting, a balance sheet or statement of financial position is a summary of the financial balances of a sole proprietorship, a business partnership, a corporation or other business organization, such as an LLC(Limited Liability Company) or an LLP(Limited Liability Partnership).

Bank Reconciliation
A Bank reconciliation is a process that explains the difference between the bank balance shown in an organization'sbank statement, as supplied by the bank, and the corresponding amount shown in the organization's own accountingrecords at a particular point in time.

Financial Transaction
A financial transaction is an agreement, communication, or movement carried out between a buyer and a seller to exchange an asset for payment.


Asset Disposal
Asset disposal is the act of selling an asset usually a long term asset that has been depreciated over its useful life like production equipment.

Investment
An asset or item that is purchased with the hope that it will generate income or appreciate in the future. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth.

Loan
The act of giving money, property or other material goods to a another party in exchange for future repayment of the principal amount along with interest or other finance charges. A loan may be for a specific, one-time amount or can be available as open-ended credit up to a specified ceiling amount.

Lease
An agreement in which one party gains a long-term rental agreement, and the other party receives a form of secured long-term debt.

Sales
Sales is the act of selling a product or service in return for money or other compensation.

Orders
Is an instruction from a customer to buy things.

Customer
Is also known as a client, buyer, or purchaser) is the recipient of a good, service, product, or idea, obtained from a seller, vendor, or supplierfor a monetary or other valuable consideration.

Shareholder
A shareholder or stockholder is an individual or institution (including a corporation) that legally owns a share of stock in a public or private corporation. Stockholders are granted special privileges depending on the class of stock. 

Audit Kewangan (Finance Audit)

Audit kewangan, atau lebih tepat dinamakan audit pada penyata kewangan, adalah pemeriksaan penyata kewangan sesebuah syarikat atau organisasi lain oleh parti ketiga yang berpendirian tidak berat sebelah, lalu menghasilkan pendapat bebas mengenai sama ada penyata kewangan adalah relevan, tepat dan lengkap.

Audit kewangan biasanya diamalkan oleh firma-firma akauntan, kerana pengetahuan laporan kewangan khusus yang diperlukannya. Audit kewangan merupakan salah satu daripada pelbagai fungsi jaminan atau perbahasan yang disumbangkan oleh firma perakaunan, yang mana firma tersebut menyumbangkan pendapat bebas mengenai maklumat yang diterbitkan kepada umum.