The company’s property is the tangible and intangible values that the company uses to organize its activities and make a profit. This concept includes production and non-production assets, finance, real estate, transport, and other assets.
Accounting of the company’s property is the collection and analysis of data on the financial position of the enterprise and its property, the preparation of reports prescribed by law. In this case, the property is usually divided into several categories. Property worth less than 40 thousand rubles and which has been used for more than a year is recognized as low value. It can be written off to the expense account on the day of acceptance for accounting.
Fixed assets are means of labor that have a material and material form and retain it in the process of use. Items of property, plant and equipment are intended to be used for a long period of time, over 12 months. Fixed assets include buildings, structures, land, machinery, equipment, vehicles, etc. worth more than 40 thousand rubles.
The regular distribution of the value of assets throughout the entire period of their use for business, production, provision of services is called depreciation. There are several ways to calculate depreciation: declining balance, depreciation by the sum of numbers for the period of application, as well as a straight-line method. The company should choose the principle that is best for itself and fix it in the accounting policy. It is equally important to document the general rules for maintaining accounting of the organization’s property. The basis for depreciation is the value of the property.
Accounting distinguishes several types of sources that form the property of the company. They depend on how the company obtains its financial resources. So, it is customary to distinguish two forms of sources: own and borrowed. To calculate the amount of equity, you need to calculate the difference between the total assets and liabilities of the company. This includes authorized, reserve, and additional capital, targeted financing and retained earnings.
Equity capital is created from proceeds from the founders of the company, as well as due to the work of the enterprise itself: the production, sale of goods, provision of services, and so on. In other words, these are the company’s own funds.
The business receives borrowed capital from creditors. Accordingly, these funds will have to be returned to the company sooner or later. Borrowed capital includes not only loans and borrowings from banks, but also wage arrears, advances, debts to suppliers and other financial obligations.
Accounting is carried out to obtain a comprehensive and objective picture of the financial obligations of the enterprise, distribute dividends efficiently and fulfill obligations to creditors on time. Also, the purpose of accounting is to prepare a payment schedule for the return of borrowed money. In a more global sense, accounting guarantees the financial stability of the enterprise.
The chief accountant and other specialists in the accounting of the source of asset formation are guided by these main tasks. They try to reflect information promptly and correctly in documents and draw up transactions in accordance with the current chart of accounts.
Accounting for the sources of asset formation is based on one of the main rules: the sources of asset formation and its monetary value are equivalent.