Management Discussion & Analysis (MD&A) = VIEW ability to pay near term

obligations, its ability to fund operations and expansion and its results of operations
Notes to the Financial Statements = Explanatory notes and supporting schedules
accompany with every set of financial statements/clarify financial statements and
provide additional details.
Auditors Report = states its opinion (independent outside auditor). An unqualified
opinion is an independent auditor's judgment that a company's financial records and
statements are fairly and appropriately presented, and in accordance with Generally
Accepted Accounting Principles (GAAP). An unqualified opinion is the most common
type of auditor's report.
1. Description of significant accounting policies = Notes to the financial statement
2. Unqualified opinion = Auditors Report
3. Explanations of uncertainties and contingencies = Notes to the financial
statements
4. Description of ability to fund operations and expansion = MD&A
5. Description of results of operations = MD&A
6. Certified public Accountant (CPA) = Auditors Report
Financing = collecting funds to support the business
Investing = acquiring the resources necessary to run the business
Operating = putting the resources into action to generate profit
Income statement = revenues & expenses, retained earnings (ALL for specific periods
of time)
Balance Sheet = Reports assets, liabilities & stockholders equity of a business
Statement of cash flow = summarizing information concerning the cash flow (receipts)
and outflow (payments)
ASSETS = LIABILITY + STOCKHOLDERS EQUITY
Annual report = includes the annual report, manager discussion and analysis, notes to
the financial statement, auditors report.

PROMPT
Property, -Plant & Equipment (PP&E)
CORRECT ANSWER
-used by the business
-what you pay is what it goes on the balance sheet as (Historical Cost Principle)
-NOT the value of the business
 PROMPT
Accounts Payable
CORRECT ANSWER
Obligations to supplier of goods.

PROMPT
Not disclosed
CORRECT ANSWER
The names and positions of all employees hired in the last year.