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Profit and loss account in the international context

Author

Listed:
  • PALIU-POPA LUCIA

    (Constantin Brancusi University, Faculty of Economics, Romania)

  • COSNEANU LAVINIA

    (Constantin Brancusi University, Faculty of Economics, Romania)

Abstract

Given that the objective of financial statements is to provide information about the financial position, financial performance and cash flows of an economic unit, useful for a wide range of users in making economic decisions, particular attention should be paid to the profit and loss account, which is the main instrument for reflecting the financial performance, because on the one hand it provides the information necessary for their evaluation, and on the other hand the information essential for determining the risk of cash flows. Even if each component of the financial statements provides different pieces of information, they should be correlated because they reflect different aspects of the same transactions or events, and in this article we will address the general aspects of profit and loss account from the perspective of profit and loss account models. In this regard, after a brief theoretical approach of the profit and loss account, we will indicate the advantages of two models of profit and loss account but without forgetting their limitations. Thus, we will provide the income statement structure on two stages of normalization: internationally and nationally.

Suggested Citation

  • Paliu-Popa Lucia & Cosneanu Lavinia, 2011. "Profit and loss account in the international context," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 2, pages 18-25, May.
  • Handle: RePEc:cbu:jrnlec:y:2011:v:2:p:18-25
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    Cited by:

    1. HADA Izabela Diana & MIHALCEA Mihaela Maria, 2020. "The Importance Of Profitability Indicators In Assessing The Financial Performance Of Economic Entities," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 219-228, July.
    2. Izabela Diana Hada, 2020. "Analysis and Evolution of Profitability in the Pharmaceutical Field in Romania," Book chapters-LUMEN Proceedings, in: Marcin Waldemar STANIEWSKI & Valentina VASILE & Adriana Grigorescu (ed.), International Conference Innovative Business Management & Global Entrepreneurship (IBMAGE 2020), edition 1, volume 14, chapter 55, pages 744-757, Editura Lumen.

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