Day 30 of the BOI-LBS Entrepreneurship Development Programme sponsored by the Bank of Industry. #EDP2022.

Day 30 of the BOI-LBS Entrepreneurship Development Programme sponsored by the Bank of Industry. #EDP2022.

Dr Francis Okoye had a session on ‘Accounting for SMEs’ where he introduced our cohorts to key components of accounting for SMEs.

Here are key learning points:
1. A financial statement is a document that details the operations and performance of a company’s finances. Lenders and investors use it to evaluate a company’s financial stability and potential earnings.

2. Users of financial statements:
-Management of the company
-Customers
-Government and its agencies.
-Investment analysts
-Competitors
-Lenders

3. Source documents are original documents which are generated at the point where the financial activity happens. Examples are invoices, receipts, credit notes, debit notes etc.

4. Source documents are either internally or externally generated; it is important to think about source documents so you can demand for them if they are external, or create them if they are internal.

5. A transaction is any event that has a financial impact on the business and can be measured reliably.

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