Cash is something for which all organizations involved in the sale of goods and services carry out their activities. Making a profit is the main goal of any business company in a market economy. From the money received, all market participants must pay tax fees in favor of the state. And for the accuracy of the calculation of these amounts, accurate accounting and reporting is necessary. For these purposes, there are many forms of reporting documents, one of which is the balance sheet. This article discusses issues such as types of funds in the balance sheet, cash in cash and non-cash forms, their equivalents, accounting accounts, lines in the table, and also analysis tasks.
A few words about the balance sheet
The balance sheet is the organization’s most important reporting document . It reflects summary information about all the assets of the company, the sources of their formation, liabilities to other companies and government agencies. It is also called Form No. 1 of the financial statements. Presented in the form of a table, it is divided into two columns - asset and liability. The first part contains all the property and investments of the company, expressed in monetary terms, that is, the assets of the organization. The second part contains information about where the funds came from - property, equity, reserves, long-term and short-term obligations to other participants in the business process. This article will focus on cash in the balance sheet. This line refers to the balance sheet asset, namely to its second section - current assets. In the same part are several other types of property.
What is in the asset
Cash in the balance sheet is only part of the asset. In the same column, next to the company’s money, the following types of values are listed: fixed assets and assets that do not have a material form, objects under construction, investments in other organizations and income funds, deferred tax assets, raw materials used in the production, materials for collateral for the organization, manufactured products, debts of other companies, VAT on acquired values and other types of property of varying degrees of liquidity. Cash in the balance sheet is by far the most liquid part of assets.
The objectives of the analysis of cash in the balance sheet
Cash in the balance sheet is not just a figure. This is the key to the stable activity of the company, its ability to meet its debts, as well as to ensure internal needs and the production cycle. For an economist and accountant, conducting analytics and structuring cash is a very important part of the job. Its completeness and reliability is necessary for a number of further actions, making managerial decisions, as well as for external users, such as financial organizations, banks, investors, sponsors and others.
Analysis of the state of cash accounts involves such measures as monitoring the turnover of financial flows, circulation time, determining the optimal amount of liquid funds in the accounts, forecasting upcoming financial cycles, drawing up and distributing budgets.
Asset Accounts
All tangible goods and intangible assets are accounted for in accounts specially designed for each specific category of funds, property or operations. The code numbering of accounts is the same for all companies operating in the territory of the Russian Federation, and is set out in the Chart of Accounts. Cash in the asset balance sheet of the organization is accounted for using the following list of accounts of BU:
- 01 - funds related to fixed assets - an account that reflects assets used in economic activity for more than 12 months.
- 04 - intangible assets - property that does not have a tangible form (for example, a patent or software).
- 10 - Materials - everything that is used in the production process or management activities.
- 43 - Manufactured products - what is already awaiting sale in the warehouse.
- 45 - Shipped products - products that were sold, but money for it has not yet arrived.
- 50 - Cashier - cash for the needs of the organization and salary, as well as income from customers.
- 51 - accounts used for settlements, organization money for various needs.
- 52 - money in foreign currency accounts in ruble terms.
- 55 - special accounts in financial institutions, such as deposits.
- 57 - Transfers in transit - funds that were sent through special services, but have not yet reached the organization.
- 58 - investments in shares, authorized capital of other companies and other profitable placements of funds.
All of these accounts are active, that is, the receipt is reflected in the debit, the expense in the loan. They are also called inventory. The meaning of this name is that the presence or absence of these funds can be checked during the inventory.
Lines in Form No. 1
If the company is located on the simplified tax system (aka “simplified”), the aggregate of all funds located on accounts 51, 50, 52, 55 and 57 is shown at line 1250 in the balance sheet. That is, the total amount as of December 31 of the year includes cash desk balances, foreign currency and settlement accounts, special purpose accounts, as well as transfers on the way. If the money is deposited with a bank in a deposit account and brings the company a certain percentage of income, it is reflected as a financial investment. In balance, these are lines numbered 1170 or 1240.
If an organization uses a common taxation system, its balance sheet has a slightly different line numbering. Then the company's funds in the balance sheet will be reflected in line 260. Short-term deposits with accrued interest - in line 250, and long-term - 140.
Money in the current account
In order to reflect the processes associated with the receipt and disposal of funds in current accounts, organizations use an account 51. The account is active, it can correspond with several other accounts in the accounting chart of accounts. So, when conducting operations with the receipt of funds, accounting records the correspondence of the debit of account 51 with the credit of the following accounts of the plan:
- 50 - cash payment from the cash desk to the settlement account.
- 62 - receipt of money for goods or services from customers.
- 90.1 - reflection of revenue.
- 91.1 - reflection of the money that the organization received in the event of the sale of materials, funds and other assets that were not originally intended for sale in the main field of activity.
- 66 - obtaining a loan for a short period.
- 67 - obtaining a long-term loan.
- 55 - crediting the balances of special accounts to settlement.
- 76 - receipt of debt from the debtor.
- 78 - customer repayment of shortage.
When spending money from a current account, the following correspondence is used, in which 51 accounts are shown on credit, and the codes listed on debit are:
- 50 - withdrawal of money from the current account to the cashier, for example, to pay salaries.
- 60 - payment for goods and services to contractors and contractors.
- 68 - payment of taxes, duties, other fees to the state.
- 91.2 - settlements with banks on interest loans.
- 67 - payment of long-term loans.
- 66 - payment of short-term loans.
- 69 - payment to social funds for employees.
- 58 - financial investments.
- 76 - payment of accounts payable.
To carry out operations, the company provides the following documents to the bank servicing its current account: an announcement for a cash contribution, a cash receipt, a payment order or, if the counterparty requests money, a request. In some cases, the bank writes off funds on its own. For example, if a request has been received to write off tax arrears from the relevant public service.
Organization cash desk contents
Cash in the balance is not only bank accounts, but also the contents of the cash desk. They, too, must be correctly taken into account, written off and accepted, formalized and reflected in the analytics of the control unit. The following correspondence of accounts of the BU plan is used upon receipt at the cash desk, where 50 accounts are shown on debit and on the loan listed below:
- 51 - receipt from current accounts;
- 71 - refund of money from accountable persons;
- 66 - short-term loan;
- 55 - receipt of funds from a special account to the cashier;
- 90.1 - posting of revenue.
The expense from the cash register is made out by the following correspondence, where the fiftieth account is reflected on the loan, and on the debit - the following codes:
- 70 - payment of salaries to employees;
- 71 - the issuance of funds to the accountable;
- 26 - payment of household needs in cash;
- 51 - announcement of a cash contribution to the bank;
- 66 - repayment of a short-term loan from the cash desk.
All operations of depositing and withdrawing funds from the cash desk are documented: cash and debit cash warrants, cash payment announcement, receipt, cash voucher.
Cash reporting
In addition to the balance sheet, the organization must also draw up other forms of documents in which it reports on the funds received and disposed of. Among these documents: an appendix to the balance sheet, income statement, cash book, cash flow statement, book of purchases and sales. All these documents are prepared by the accountant at the end of the reporting period. In some cases, there is a need to report in interim periods. If the end of the period is December 31 of the current year, reports must be submitted no later than January 15. Intermediate periods - the end of the quarters of the year, that is, March 31, June 30, September 30. Reporting by quarter is submitted no later than half the month following the end of the period.
The set of reporting forms gives an idea of the company, its financial situation, the ability to meet obligations. If the organization does not submit the reports, submits it at the wrong time or with erroneous data, it may be subject to penalties, unscheduled tax inspections, blocking accounts, prohibition of activities, and compulsory bankruptcy proceedings. In some situations, punishment is provided for the management of the organization - criminal and administrative.