The Accounting Review Vol. 39 No. 3 1964
TEACHING THE FUNDS STATEMENT--A CONCEPTUAL APPROACH.
Abstract
The article analyzes the method of teaching of the funds statement. It is believed to be the most confusing subjects of the accounting. The article informs that a woeful lack of conceptual understanding of this subject seems to be as prevalent with the advanced student as well as with the student studying at the elementary level. The basic reason for this general lack of understanding, as well as appreciation, of the Funds Statement seems to be that the textbook' presentation of this material ignores previously learned accounting concepts and explores techniques which are unrelated to the students' accounting background. Now that the Funds Statement is considered complementary, rather than supplementary, to the Statement of Income and the Statement of Financial Position, accounting concepts should be stressed as much with the Funds Statement as with the other correlative statements. The funds statement is a statement of the change in equity as it relates to working capital-no more, no less. The difficulty in preparing a funds statement arises from the process of converting data kept on a completely accrual basis to data reflecting only working capital transactions.
- DOI
- 10.2308/tar-7134895
- Volume
- 39
- Issue
- 3
- Pages
- 756-759
- Language
- en
- Sources
- openalex crossref