Tracking Financial Performance Standards of ... - Sa-Dhan

Tracking Financial Performance Standards of Microfinance InstitutionsTermAccounts PayableAccounts Payable LedgerAccounts ReceivableAccounts Receivable AccountAccounts Receivable LedgerAccounts Receivable TurnoverAccrual BasisAccrualAccrued ExpensesAccrued RevenueAccrued SalariesAccumulated DepreciationAcid-Test RatioAdditionAdequate Disclosure PrincipleAdjusting EntriesAging ScheduleDefinitionThe liability that results from purchasing goods or services on credit.Amountsentities owe suppliers for goods and services. Listed in the current liabilitiessection on the statement of financial position.A subsidiary ledger that lists the individual accounts of creditors. Also calledthe creditors' ledger.The asset arising from selling goods or services on credit to customers. Listedin the current assets section on the statement of financial position.An asset account that shows the total currency (dollar or rupee or pound)amount due from credit customers.A subsidiary ledger containing only accounts of credit customers; also calledthe customers' (debtors) ledger.A measure that indicates how quickly an entity is collecting its accountsreceivable. Calculated by dividing net credit sales by average net accountsreceivable.Method of accounting that recognizes revenue when earned, rather than whencollected. Expenses are recognized when incurred rather than when paid. Thebasis of accounting that requires that revenue is recorded when earned, nomatter when cash is received, and that expenses are recorded when incurred,no matter when cash is paid.An expense or a revenue that gradually increases with the passage of time.Expenses that build up or accumulate during the current period but will notbe paid until the next period. Also called accrued liabilities.Unbilled amountsearned by others during a given period which are not yet dueRevenue that has been earned in the current accounting period but will not bereceived until the next period. Also called accrued assets. Accrued interest isan example from the financial services and micro-finance sectorSalaries that are unpaid (and unrecorded) at the end of an accounting period.Also called accrued wages.Total depreciation pertaining to an asset or group of assets from the time theassets were placed in services until the date of the financial statement. Thetotal depreciation from the start of the life of a physical asset to any point intime.This total is the Contra Account to the related asset account.The ratio of the sum of cash, receivables, and marketable securities to currentliabilities.The ratio of quick assets to current liabilities. A yardstick commonlyused is a 1-to-1 ratio. Also called quick ratio.A capital expenditure that literally adds on to an existing physical asset. Thecost of an addition is debited to the physical asset account.States that financial statements or the explanatory notes and schedules that gowith the statements must disclose all relevant data about the financial positionof an entityEntries made at the end of an accounting period to bring the balances ofcertain accounts up to date.A schedule in which accounts receivable are grouped into age categories andan estimated bad debts rate is applied to each age category.112