What are income tax basis financial statements?
Income tax basis financial statements are financial statements that are reported for entities that have more of a complex situation. All nontaxable income will be required to be recognized using tax basis financial statements.
Financial statements written based on the income tax basis will result from regulations provided from the Internal Revenue Code (IRC) and will generally be applied when filing tax returns to the Internal Revenue Services (IRS).
The visual below provides the financial schedules that would be required under the income tax basis:
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What does OCBOA stand for and what types of frameworks would be included?
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What are the components of the financial statements called under the “cash basis” special purpose framework?
As you can see in the visual below, under the cash basis method, the company would prepare a “statement of cash and equity” and a “statement of cash receipts and disbursement”.
What does OCBOA stand for and what types of frameworks would be included?
“OCBOA” stands for “Other Comprehensive Basis of Accounting” and relates to special purpose frameworks. Generally, GAAP is how financial statements will be reported when presenting financial statements for public reporting companies. However, financial statements will at time, not be reported under GAAP. For example, special purpose frameworks (other than GAAP) may be used by sole...
What is the difference between the cash basis of accounting and the modified accrual/cash basis of accounting?
The modified cash basis of accounting is when a company combines the cash basis of accounting and the accrual basis of accounting. The modified cash basis, sometimes referred to as the modified accrual basis of accounting (will see more in the government accounting lecture), will primarily be used for non-profit organizations as well as government...
What are the components of the financial statements called under the “cash basis” special purpose framework?
As you can see in the visual below, under the cash basis method, the company would prepare a “statement of cash and equity” and a “statement of cash receipts and disbursement”.
