Plumb Accounting Basics | Concepts, Principles & Basis

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Plumb Accounting Basics: Concepts, Principles & Basis

Plumb outsourced accounting

A. Entity Concept

  • An organization stands apart from other organizations as a separate economic unit

B. Going Concern Concept

  • Entity will continue to operate long enough to recover cost of its assets

C. Time Period Concept

  • Report information at regular intervals

D. Reliability Principle

  • Accounting records must be based on the most reliable (verifiable by an independent observer) data available

E. Cost Principle

  • Assets/services acquired are recorded at actual, historical cost

F. Revenue Principle

  • Establishes when to record revenue, usually when earned
  • Revenue is earned when the business has completed rendering services to the customer

G. Matching Principle

  • Expenses matched against revenues in same accounting period

H. The Accounting Period

  • Usually one year ending December 31
  • Fiscal year ends on any other date of the year

I. Cash Basis Accounting

  • Impact of events not recognized until cash is paid or received

J. Accrual Basis Accounting

  • Impact of events recognized as they occur
  • Transactions are recorded even when cash no received or paid
  • Required by GAAP

K. Stable Monetary Unit

  • Basis of ignoring inflation

Plumb Accounting provides expert services and support to accounting departments and growing organizations that need added expertise but do not want the burden of full-time Controller or CFO.

Services Offered:

  • Outsourced Accounting
  • Outsourced Bookkeeping
  • Policy and procedure review
  • Audit preparation
  • Budget review and preparation
  • Accounting systems/software analysis
  • M & A Accounting
  • Performance indicator development
  • Cash flow forecasting
  • Software upgrades
  • Monthly financial statements
  • Cash management
  • Vendor management
  • Management reporting
  • SEC reporting

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