INTRO - CORPORATE ACCOUNTING

1. Corporate Accounting

2. Corporate
An entity created by
law.
Existence is separate
from owners.
Has rights and
privileges.
Ownership
can be
Privately Held
Publicly Held

3. Characteristics of an
Corporate
• Voluntary association of persons
• Separate legal entity
• Common seal
• Perpetual succession
• Limited liability
• Transferable shares
• Delegated Management

4. Meaning of Corporate
Accounting
• Corporate accounting refers to the
measurement, recording and interpretation of
financial information and data relating to a
limited company (a public limited company or
a joint stock company).

5. Organizing and Managing
a Corporation
Stockholders
Board of Directors
President, Vice-President,
and Other Officers
Employees of the Corporation

6. Organizing and Managing a
Corporation
Corporate Organization Chart
Secretary Vice President
Finance
Vice President
Production
Vice President
Marketing
President
Board of Directors
Stockholders
Stockholders
usually meet once
a year.
Ultimate
control.
Selected by a vote
of the
stockholders.
Overall
responsibility for
managing the
company.

7. Share Capital
• According to Sec 2(46) of the Companies Act
1956, share has been defined as a share in
the share capital of the company; and
includes stock except where a distinction
between stock and share is expressed or
implied.

8. Classes of Shares
Equity shares Preference shares
Participative
shares
Convertible
shares
Redeemable
shares
Cumulative
shares

9. Rights of Shareholders
Vote at stockholders’ meetings.
Sell stock.
Purchase additional shares of stock.
Receive dividends, if any.
Share equally in any assets remaining after
creditors are paid in a liquidation.