APPLICATION OF FUNDS MADE PRACTICAL.
Too frequently in the past the application-of-funds statement, if used by the auditor, has been included as a schedule or exhibit in the back part of the report. In too many cases also, the main application-of-funds statement has been supported by a working-capital schedule, which served as a catch-all for items that seemed difficult to classify and which served no especially useful purpose not covered by a comparative balance sheet. As a result of such type of presentation, the application-of-funds statement has been growing less and less significant to the executive and has been practically ignored by many in the process of examining an auditor's report, even when the report contained such a statement. The application-of-funds idea, however, is too valuable to have its real existence jeopardized by an unfortunate selection of form and location in the auditor's report. The main purpose of an application-of-funds statement or summary is to answer a type of question regarding the financial status and operating results which is not answered by the balance sheet or operating statement.
- DOI
- 10.2308/tar-7033883
- Volume
- 19 (1)
- Pages
- 20-31
- Language
- en
- Export
- BibTeX
- Sources
- openalex crossref