Английский язык: Сборник текстов. Гурская Т.А. - 19 стр.

      Liabilities
    Liabilities include long-term loans and debentures, short-term loans, and bank
overdrafts, payables, pension plans and similar financial obligations. The scope of de-
finition of liabilities covers obligations whose financial amounts can or cannot be es-
tablished precisely. It therefore covers what is usually described as provisions in some
countries. Provisions are liabilities, the amount of which cannot be established pre-
cisely, or the occurrence of which is uncertain. In some countries, provisions may not
be used to adjust the value of assets. In those countries, value adjustments on debtors
are referred to as write-downs. In other countries, write-downs on debtors are com-
monly referred to as provisions. Provisions should be distinguished from .reserves,
which are amounts set aside under equity for future use with respect to obligations
which may arise from probable or possible events.
    A liability is recognized when it is reasonably certain that a future reduction in
economic benefit will result from the settlement of the obligation.
      Equity
    Paid-in capital is treated differently in many countries, in some of which all
amounts paid in by equity shareholders are classified as paid-in and are not further ca-
tegorized. In other countries, paid-in capital is divisible into two types: that relating to
the par value of the shares offered for sale and that relating to share premium or addi-
tional capital. In consolidated balance sheets, the amount of equity should be given sep-
arately for the shareholders of the parent enterprise and for other shareholders.
    Equity is a residual arising from the deduction of liabilities from the assets of the
reporting enterprise. Equity arises from two sources: that provided by shareholders
(for example, paid-in capital) and that generated by the activities of the enterprise (for
example, earnings less distributions to shareholders, unrealized surpluses).

                     B. Income statement/ profit and loss statement
    The income statement, or profit and loss statement measures performance of an
enterprise. The bottom line of this statement is the net result of the operations of the
enterprise in the reporting period. It reveals the change during the period in the equity
of the enterprise resulting from its operations.
      Revenues
    Revenues are inflows or enhancements of assets (or reductions of liabilities) that
arise in the course of the normal activities of the enterprise.
    The events that result in revenues and revenues themselves are referred to by a va-
riety of names: including sales, fees, interest, dividends, royalties and rent.
      Expenses
    Expenses are outflows or depletions of assets (or additions to liabilities) that arise
in the course of the enterprise's normal activities.
    The events from which expenses arise and expenses themselves are referred to by
a variety of names, including cost of sales, wages and depreciation.
    An expense is recognized when it is realized that an expenditure does not produce
future economic benefits. It is also recognized when a liability is incurred without the
recognition of an asset. When it is possible to do so, expenses are recognized in the
income statement on the basis of direct association between expenses incurred and the
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