Final accounts definition
/What are Final Accounts?
Final accounts is a somewhat archaic bookkeeping term that refers to the final trial balance at the end of an accounting period. The financial statements are derived from this information, as part of the period-end closing process. This final trial balance includes every journal entry used to close the books, such as the following:
Wage and payroll tax accruals
Income tax accruals
Asset write downs
Adjustments to reserves for returns, bad debts, and obsolete inventory
Customer billings
Thus, final accounts can refer to the final trial balance or the financial statements upon which they are based. The primary financial statements are the income statement, balance sheet, and statement of cash flows.
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Since final accounts refers to a company's ending account balances, which in turn are used to create financial statements, this means that the final accounts reveal the results of the business during a period, its financial position at the end of that period, and its sources and uses of funds during that period (which is the purpose of the financial statements). Auditors rely upon a client’s final accounts to conduct an audit of its accounting records and financial statements.
Final Accounting
A final account, or final accounting, can also be the summarized statement issued when a business transaction has been concluded. For example, when someone leaves a hotel, they are given a final accounting of what they owe the hotel. In the case of a hotel, the final accounting might include the per-night lodging cost, as well as the cost of meals, incidentals, room taxes, resort fees, and parking.