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remuneration reserve - will be used later to pay bonuses to employees or management. translation reserve - arises during consolidation of entities with different reporting currencies; Reserve is the profit achieved by a company where a certain amount of it is put back into the business which can help the business in their rainy days.
An example of a cookie jar reserve is a liability created when a company records an expense that is not directly linked to a specific accounting period—the expense may fall in one period or another. Companies may record such discretionary expense when profits are high because they can afford to take the hit to income. When profits are low ...
Current ratio is generally used to estimate company's liquidity by "deriving the proportion of current assets available to cover current liabilities". The main idea behind this concept is to decide whether current assets which also include cash and cash equivalents are available pay off its short term liabilities (taxes, notes payable, etc.)
A standard company balance sheet has two sides: assets on the left, and financing on the right–which itself has two parts; liabilities and ownership equity. The main categories of assets are usually listed first, and typically in order of liquidity. [3] Assets are followed by the liabilities.
Liabilities of uncertain value or timing are called provisions. When a company deposits cash with a bank, the bank records a liability on its balance sheet, representing the obligation to repay the depositor, usually on demand. Simultaneously, in accordance with the double-entry principle, the bank records the cash, itself, as an asset. The ...
[citation needed] The term "reserve" can be a confusing accounting term. In accounting, a reserve is always an account with a credit balance in the entity's equity on the balance sheet, while to some non-accountants (e.g., actuaries), it has the connotation of money set aside to meet a future liability (a debit balance).
Conventional loan. 2 to 4 months for second homes. 6 months for cash-out refinances with a DTI ratio above 45%. 6 months for investment properties. 6 months for primary residences up to 4 units
IAS 37 establishes the definition of a provision as a "liability of uncertain timing or amount", and requires that all the following conditions be fulfilled before a provision can be recognized: the entity currently has a liability as a result of a past event; an outflow of resources is likely to be needed to settle the liability; and