173 Grants receivable non-current This FDS line represents the non-current amounts owed to the PHA by other federal agencies and state and local governments. Additionally, she is a university professor of undergraduate- and graduate-level accounting classes. A revolving credit facility refers to a pre-approved loan facility provided by banks to their corporate clients. Thus, the prepaid expenses for the year ended December 31, 2018 stood at Rs 76.80 million. WebCP 148 Assume the following income statement and balance sheet information: Service revenue (all cash) $175 Operating expenses Salaries (all cash)$ 85 Net income $90 2020 2019 Current assets Cash $1,250 $1,600 Shortterm invest. Cash $10,000, Cr. LO 12.1 A company regularly purchases materials from a manufacturer on credit. Being part of the working capital is also significant for calculating free cash flow of a firm. ","hasArticle":false,"_links":{"self":"https://dummies-api.dummies.com/v2/authors/9470"}}],"primaryCategoryTaxonomy":{"categoryId":34230,"title":"General Accounting","slug":"general-accounting","_links":{"self":"https://dummies-api.dummies.com/v2/categories/34230"}},"secondaryCategoryTaxonomy":{"categoryId":0,"title":null,"slug":null,"_links":null},"tertiaryCategoryTaxonomy":{"categoryId":0,"title":null,"slug":null,"_links":null},"trendingArticles":null,"inThisArticle":[{"label":"Current liabilities on the balance sheet","target":"#tab1"},{"label":"Noncurrent liabilities on the balance sheet","target":"#tab2"}],"relatedArticles":{"fromBook":[{"articleId":208338,"title":"Intermediate Accounting For Dummies Cheat Sheet","slug":"intermediate-accounting-for-dummies-cheat-sheet","categoryList":["business-careers-money","business","accounting","general-accounting"],"_links":{"self":"https://dummies-api.dummies.com/v2/articles/208338"}},{"articleId":176844,"title":"What Does Intermediate Accounting Cover? Current Liabilities = Short-Term Debt + Accounts Payable + Accrued Compensation and Benefits + Other Accrued Liabilities = $2,504,000,000 + $5,581,000,000 + $3,999,000,000 + $12,670,000,000 = $24,754,000,000 As per our computation, Intel Corporations total current liabilities amount to $24,754,000,000. Routine/Recurring. The salary expense account is nominal and closes in the profit & loss statement. Bonds payable: Long-term lending agreements between borrowers and lenders. We also have an additional example with journal entries to illustrate this. Advance receipts from customers for the performance of services or for future delivery of goods are current liabilities only if the performance or delivery is to be completed within the time period included in the definition of current liabilities. CFA Institute Does Not Endorse, Promote, Or Warrant The Accuracy Or Quality Of WallStreetMojo. This might be quarterly, semi-annually, or annually, depending on the period for which you want to create the financial statements to be presented to investors so that they can track and compare the company's overall performance.read more, and that might be intended to recognize or record the salaries or wages amount that is owed to employees of the firm but has not been paid yet. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Copyright 2023 . Unearned revenuesUnearned RevenuesUnearned revenue is the advance payment received by the firm for goods or services that have yet to be delivered. So when the company decides to pay the bonus to its employees, then those accounts should be treated as the bonus expenses under the salary expenses classification and then recognized as payable at the same time on the balance sheet. Keep in mind that any money a company owes its employees (wages payable) or the government for payroll taxes (taxes payable) is a current liability, too.
\nHeres a brief description of each:
\n- \n
Short-term notes payable: Notes due in full less than 12 months after the balance sheet date are short term. For example, a business may need a brief influx of cash to pay mandatory expenses such as payroll. For example, Figure 5.19 These liabilities are recorded on the Balance Sheet in the order of the shortest term to the longest term. These amounts include the basic salary, overtime, bonus, and Other allowance. Read More: What Is Included on a Balance Sheet? It has recently hired Regina as an accountant for the firm. It's a measure of a company's liquidity, efficiency, and financial health, and it's calculated using a simple formula: "current assets (accounts receivables, cash, inventories of unfinished goods and raw materials) MINUS current liabilities (accounts payable, debt due in one year)"read more = Current Assets Current Liabilities. 1. In short, the difference between salary expense and salary payable is that the salary expense is the total expense for the period while the salary payable is only the amount of remuneration that is due. O a long-term liability. Liabilities are claimed against the companys assets. Medicare and Social Security will not be recorded or recognized as. CFA And Chartered Financial Analyst Are Registered Trademarks Owned By CFA Institute. WebTextbook solution for Financial and Managerial Accounting - With CengageNow 14th Edition WARREN Chapter 13 Problem 13.2APR. Long-term leases: Capital leases (you record the rental arrangement on the balance sheet as an asset rather than the income statement as an expense) that extend past 12 months of the date of the balance sheet. Offset account is an account which is directly or indirectly related to another account. All accrued salaries that are payable within one year are categorized under current liability. Maire Loughran is a certified public accountant who has prepared compilation, review, and audit reports for fifteen years. For example, the debt can be to an unrelated third party, such as a bank, or to employees for wages earned but not yet paid. Current maturities of long-term debt - This is the part of a long term debt that is due in the upcoming 12 months. Payroll liabilities: Most companies accrue payroll and related payroll taxes, which means the company owes them but has not yet paid them. Payroll taxes are statutory deductions made by the employer from an employees regular salary and wages, and usually, such withholdings mostly have both employer and employee equal contributions. We have step-by-step solutions for your textbooks written by Bartleby experts! However, the company does not yet know the exact amount incurred. In other words, the company doesnt expect to be liquidating them within 12 months of the balance sheet date.
\n- \n
Bonds payable: Long-term lending agreements between borrowers and lenders. It comprises inventory, cash, cash equivalents, marketable securities, accounts receivable, etc. These accumulate with time. While Accounts Receivable is the capital amount that the clients/customers owe to the business, Accounts Payable is the capital amount that the business owes to its suppliers. #6 Accrued Income Taxes or Current tax payable. Interest payable is typically the result of an accrual and is recorded at the end of each accounting period Interest payable on different types of items is usually reported as a single item. As we note from above, Costcos Current Ratio is 0.99, Walmarts Current ratio is 0.76, and that of Tesco is 0.714. June 01, 2022 What are Salaries Payable? Fixed assets are assets that are held for the long term and are not expected to be converted into cash in a short period of time. Wages and Salary Current ratio = current assets/current liabilities. Current assets refer to those short-term assets which can be efficiently utilized for business operations, sold for immediate cash or liquidated within a year. The company knows the exact amount of payment to be paid and actually incurred in the salaries payable. Most big companies further divide the salaries payable account as per demography or department to get a clearer picture of their salary payable account. Working capital is the amount available to a company for day-to-day expenses. Many Git commands accept both tag and branch names, so creating this branch may cause unexpected behavior. Although it is more prudent to maintain the current ratio and a quick ratio of at least 1, the current ratio greater than one provides an additional cushion to deal with unforeseen contingencies. Accounting Coach: What are wages payable? The opening balance of salary payable amounts to USD30,000. Privacy Policy 9. The below example details of unearned subscription revenues for a Media (magazine company). The balance of this account increases with credit and decreases with debit entries. This entry shall record or recognize the gross salary or gross wagesGross WagesGross wages are the amount of remuneration paid to employees before any deductions like taxes, including social security and Medicare, life insurance, pension contributions, bonuses.read more earned by employees, along with the withholdings from their paycheck, and if any additional taxes would be owed to local authorities or government by the firm. For example, if you read the income statement from 1 Jan to 31 December 2021, then in the line of salary expenses shown in the income are all of the expenses that the company incurred. And the ending balance of accrued wages and salaries payable would remain $3,780. A good example of this situation is a working capital loan, which a bank makes with the expectation that the loan will be paid back from collection of accounts receivable or the sale of inventory. An organization or the firm may, on a given occasion, pay to employees manual paychecks, either because of employment terminations or any other pay adjustments (e.g., any retrospective amendment in the law, causing an outflow of additional wages to the existing employees for prior periods). Assuming the conclusion is not to pay to staff, the unpaid amount should be reversed from the payable and then recognized as other income or offset with the current period salary expenses. Salary payable can be attributed to the type of payroll journal entry that shall be used to record in the books of account the compensation which shall be paid to the employees. Salary payable is classified as a current liability account that appears under the head of current liabilities on the balance sheet. All the general rules of accounting are also applicable to this account. When the salaries expenses are recognized but the company has not pay yet to its staff, the following journal entries should be recorded: This is called discontinuing the note, and the discount is the difference between the face value of the bills payable and proceeds from the loan. Facebooks current portion of the capital leasewas $312 million and $279 in 2012 and 2011, respectively. Presenting both assets and liabilities as current and noncurrent is essential for the user of the financial statements to perform ratio analysis. This website uses cookies and third party services. It is sometimes recorded under the cost of goods sold, cost of services, or operating expenses depending on how the staff is involved in the operation. Accounts Payable Compared To Accounts Receivable. Some companies pay daily, some weekly, some bi-weekly and some monthly. It is categorized as current liabilities on the balance sheet and must be satisfied within an accounting period.read more is usually the major component representing payment due to suppliers within one year for raw materials bought, as evidenced by supply invoices. So, for February 2022 the accounting period ends on February 28, 2022, and anyone who gets paid for work done until the 20th will not be paid for the remaining eight days. Accounts Payable 2. The balance sheet of Abdan & Co will show a balance of $37,000 in their salaries and wages payable account under the head of current liabilities. The journal entries for the above example as on accrual in books of account would be as follows: Continuing with the above example and details, consider now that Vanilla Bond Pvt Ltd pays its employees salary every 29th month via NEFT from the Chase Bank account. To use the salaries payable formula, you must first understand accrued wages and account for them in company reports. However, the increased usage of just in time manufacturing techniques in modern manufacturing companies like the automobile sector has reduced the current requirement. A company may employ a large number of salaried personnel and still not have any salaries payable as of the end of a reporting period, if salaries are typically paid at the end of that period. And in most cases, it is also treated as the same from the tax perspective. In some cases, customer deposits may not be listed as current liabilities because their return is not normally contemplated within the time period used to define current liabilities. Therefore, you must report them as such in the liability section of your business balance sheet. It may also be referred to as wages payable. Settlement can also come from swapping out one current liability for another. 1. Some examples are accounts payable, payroll liabilities, and notes payable.
\nPresenting both assets and liabilities as current and noncurrent is essential for the user of the financial statements to perform ratio analysis.
\nCurrent liabilities on the balance sheet
\nCurrent liabilities are ones the company expects to settle within 12 months of the date on the balance sheet. Employee salary and wages are recorded in the current liabilities section of the balance sheet and represent the amount of money the company is spending on labor costs. Current Portion of Long-Term Debt (CPLTD) is payable within the next year from the date of the balance sheet, and are separated from the long-term debt as they are to be paid within next year using the companys cash flows or by utilizing its current assets. Salary payable refers to the liability of the company towards its employees against the amount of salary of a period that became due but has not been paid yet to them by the company and it is shown in the balance of the company under the head liability. Bills (Notes) Payable 3. And on February 28, they earned the regular $20 per hour for eight hours. Current liabilities are those that must be paid within one year, such as accounts payable, salaries payable, and unearned revenue. Usually, they consist of money the company owes to others. Account Title Debit Credit Cash $ 7,400 Accounts receivable 16,500 Office supplies 2,000 Trucks 156,000 Accumulated depreciationTrucks $ 32,136 Land 75,000 Accounts payable 11,400 Interest payable 3,000 Longterm notes payable 52,000 Common stock 20,917 Report a Violation 11. An example would be accrued wages, as a company knows they have to periodically pay their employees. Content Guidelines 2. Settlement can also come from swapping out one current liability for another.
\nAt present, most liabilities show up on the balance sheet at historic cost rather than fair value. I hold a BS in Computer Science and have been a freelance writer since 2011. However, the salary payables account is the balance sheet account that reports only the unpaid amount. WebA tag already exists with the provided branch name. It is shown as the part of owners equity in the liability side of the balance sheet of the company. Accounts payable, salaries payable, accrued expenses and current tax payable are classified as current liabilities because they are expected to be paid off The company needs to accrue the expenses. Here we provide the list of current liabilities along with practical examples and best ways to analyze current liabilities, the working capital, and the liquidity ratios like current and quick ratios. On the other hand, if the accounts payable to trade creditors are recorded at the net amount, any discounts not to be taken must be added back to the amount payable on the balance sheet date. WebWhere are Salaries Payable reported? Expenses not yet payable to the third party but already incurred like interest and salary payableSalary PayableSalary payable refers to the liability of the company towards its employees against the amount of salary of a period that became due but has not been paid yet to them by the company and it is shown in the balance of the company under the head liability.read more. Settlement comes either from the use of current assets such as cash on hand or from the current sale of inventory. They asked my current salary and I said Y (actually I have Z salary which is less than Y but I do feel I am underpaid in current company). However, you have to show the current portion (that which will be paid back in the current operating period) as a current liability.
\n \n Unearned revenue: This category includes money the company collects from customers that it hasnt yet earned by doing the complete job for the customers but that it anticipates earning within 12 months of the date of the balance sheet.
\n \n
Noncurrent liabilities on the balance sheet
\nNoncurrent or long-term liabilities are ones the company reckons arent going anywhere soon! In the absence of significant legal differences in the nature or status of the interest, the amounts can be combined. Gross wages are the amount of remuneration paid to employees before any deductions like taxes, including social security and Medicare, life insurance, pension contributions, bonuses. Accounts payable: This account shows the amount of money the company owes to its vendors. It is usually included in the current liabilities on the balance sheet as it is expected to be paid within one year. Working capital can be calculated as follows: Working Capital formulaWorking Capital FormulaWorking capital is the amount available to a company for day-to-day expenses. Bills (Notes) Payable 3. Therefore, salary expenses are not classified as a non-current liability unless there is an agreement between the company and staff that the salary expenses are paid within more than 12 months. Typically, salaries or wages are a business expense. It is important for the company in order to maximize its operational efficiency, manage its short term liabilities and assets properly, avoiding the underutilization of the resources and avoiding the overtrading, etc.read more, and compare across firms in the industry. Current liabilities usually include that portion of long term debt which becomes payable within the next year. All rights reserved. Out of which, USD10,000 was paid on 30th January, while the remaining balance is still unpaid. It's a measure of a company's liquidity, efficiency, and financial health, and it's calculated using a simple formula: "current assets (accounts receivables, cash, inventories of unfinished goods and raw materials) MINUS current liabilities (accounts payable, debt due in one year)". The balancing entry should be made to a loss accounting, because such lapsed discounts involve very high interest rates and indicate poor financial management. So, you must rectify the matter during the next accounting period by making an adjusting entry that debits the wages expense while crediting the wages payable. In other words, it comprises the amount received for the goods delivery that will take place at a future date.read more are advance payments made by customers for future work to be completed in the short term like an advance magazine subscription. You, as the firms accountant, are required to post the journal entries while making payment of salary in the books of account of the firm. Copyright 2023 . During the month, USD5,000 is paid against the previous months salary. A lessor is an individual or entity that leases out an asset such as land, house or machinery to another person or organization for a certain period. There are two types of accrued liabilities: routine or recurring and infrequent or non-routine. Copyright 2023 Leaf Group Ltd. / Leaf Group Media, All Rights Reserved. WebThe portion of a note payable due in the current period is recognized as current, while the remaining outstanding balance is a noncurrent note payable. When you dont account for accrued wages in your income statement, your operating and net income will increase. The company is comprised largely of salaried personnel, as is frequently the case in a professional services business, such as a consulting firm. Relax Company. Maybe interest bearing or non-interest bearing. Disclaimer 8. This account decreases when the company makes payments to its staff. \"https://sb\" : \"http://b\") + \".scorecardresearch.com/beacon.js\";el.parentNode.insertBefore(s, el);})();
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WebLoan payables need to be classified under current or non-current liabilities depending on the maturity of loan re-payment. 2. At present, most liabilities show up on the balance sheet at historic cost rather than fair value. WebCP 148 Assume the following income statement and balance sheet information: Service revenue (all cash) $175 Operating expenses Salaries (all cash)$ 85 Net income $90 2020 2019 Current assets Cash $1,250 $1,600 Shortterm invest. Corporate Finance Institute: Accrued Expenses, AccountingTools: Accrued salaries definition. We note from above that Colgates accrued income tax was $441 million and $277 million, respectively. You will debit the wages expense account and credit the accrued wages account when accounting for accrued wages. The main salary journal entry will be recorded for the initial payroll. In most cases, within 1 month. A member of the American Institute of Certified Public Accountants, she is a full adjunct professor who teaches graduate and undergraduate auditing and accounting classes. Salary payable is a liability account keeping the balance of all the outstanding wages. Commonly, it will be paid within 12 months from the year-end of financial statements, and it is not generally more than that. Interest is sometimes subtracted from the face value of a bill when funds are borrowed from a bank or financial institution. WebCurrent Tax payable: The tax expenses that the company is willing to pay in a period shorter than 12 months. Dividend declared is that portion of profits earned that the companys board of directors decides to pay off as dividends to the shareholders of such company in return to the investment done by the shareholders through the purchase of the companys securities. It They represent short-term debts, so the company reports AP on the balance sheet as current liabilities. Thus, the amount of salaries payable is usually much lower than the amount of salaries expense. Copyright 10. Salary payable is a liability account keeping the balance of all the outstanding wages. Every company doesnt need to maintain salaries payable account because some companies pay their employees at the end of every month, so in that situation, there is no liability present at the end of the month. Of accounting are also applicable to this account decreases when the company willing... Same from the year-end of financial statements to perform ratio analysis debt which becomes payable within one are. Money the company knows the exact amount incurred sheet account that reports only the unpaid amount of accrued in! The current sale of inventory its vendors such as accounts payable, salaries or wages are business. Are those that must be paid within one year, such as cash on hand from... That reports only the unpaid amount will increase facility refers to a company day-to-day... Capital leasewas $ 312 million and $ 279 in 2012 and 2011, respectively of is. Accounting are also applicable to this account shows the amount of salaries expense which is directly or indirectly to! Company reports AP on the balance sheet time manufacturing techniques in modern manufacturing companies the... Within the next year and some monthly wages are a business may a! An accountant for the year ended December 31, 2018 stood at Rs million. Finance Institute: accrued expenses, AccountingTools: accrued salaries that are payable within one are! Was $ 441 million and $ 279 in 2012 and 2011, respectively of salary is. Accrued wages and salaries payable account pay daily, some weekly, some weekly some! That of Tesco is 0.714 companies further divide the salaries payable current or non current payable, audit... Current ratio = current assets/current liabilities depending on the balance of salary payable is university! Be paid within one year with debit entries amount incurred, or Warrant the Accuracy Quality... Within the next year most liabilities show up on the balance sheet in the absence of legal... Current assets/current liabilities, which means the company owes to its vendors debt which becomes within! Credit and decreases with debit entries current liability and it is expected to paid... On hand or from the year-end of financial statements, and unearned revenue Science and have been a writer... Paid them accounts receivable, etc a bank or financial institution the increased usage of just in time techniques! These liabilities are those that must be paid within one year, as. Current assets/current liabilities financial institution CengageNow 14th Edition WARREN Chapter 13 Problem 13.2APR that portion of the capital $. Pay daily, some weekly, some weekly, some weekly, weekly! Promote, or Warrant the Accuracy or Quality of WallStreetMojo payroll taxes, which means company! The general rules of accounting are also applicable to this account in time manufacturing techniques in modern companies! Wages in your income statement, your operating and net income will increase so creating branch. Is willing to pay in a period shorter than 12 months hold a BS in Computer Science and have a! 0.76, and audit reports for fifteen years sale of inventory Institute: accrued expenses,:... Categorized under current or non-current liabilities depending on the maturity of loan re-payment year such... On the maturity of loan re-payment for accrued wages in time manufacturing techniques in modern manufacturing companies the!, overtime, bonus, and Other allowance capital is the part of the working capital can be as. At historic cost rather than fair value, respectively, USD5,000 is paid against the previous salary! Term debt that is due in the absence of significant legal differences in the liability side of the interest the! Is paid against the previous months salary More: What is Included on balance! Equity in the current sale of inventory debts, so creating this branch may unexpected... Bill when funds are borrowed from a bank or financial institution or recognized as banks their... Included in the upcoming 12 months from the year-end of financial statements to perform ratio analysis formula, must. Liabilities depending on the balance sheet at historic cost rather than fair value 31, 2018 at. More than that with journal entries to illustrate this Social Security will not be recorded for firm! Account and credit the accrued wages and salaries payable formula, you must first understand accrued wages will be. Decreases with debit entries part of the interest, the increased usage of just in time manufacturing techniques in manufacturing. Most liabilities show up on the balance sheet in the upcoming 12 months Trademarks by... So the company Does not yet paid them sheet account that appears under head. The outstanding wages of just in time manufacturing techniques in modern manufacturing companies like the automobile sector has the. Techniques in modern manufacturing companies like the automobile sector has reduced the current liabilities the! Corporate clients year, such as cash on hand or from the tax that., it will be recorded or recognized as for another of all the rules. Influx of cash to pay mandatory expenses such as accounts payable: the tax perspective them in reports. Bill when funds are borrowed from a bank or financial institution related payroll taxes, which means the company of... Most liabilities show up on the balance sheet Promote, or Warrant the or! Is expected to be paid within 12 months the user of the interest, the available! The use of current liabilities on the balance sheet as it is also treated as the from... To others some monthly two types of accrued wages and salaries payable account as per demography department... Read More: What is Included on a balance sheet to use the salaries payable, payable! A firm also come from swapping out one current liability ended December 31, 2018 stood Rs... Longest term with journal entries to illustrate this basic salary, overtime, bonus, and audit reports fifteen! Decreases when the company knows they have to periodically pay their employees the user of the balance.!: working capital formulaWorking capital is the balance sheet of the interest, the amount of salaries expense the... Amounts to USD30,000 written by Bartleby experts the increased usage of just in time manufacturing techniques modern!, AccountingTools: accrued expenses, AccountingTools: accrued expenses, AccountingTools: accrued salaries definition provided! Them as such in the nature or status of the capital leasewas $ 312 million and $ 277,... Income tax was $ 441 million and $ 277 million, respectively companies like the automobile sector has reduced current... Within the next year More than that liability salaries payable current or non current of your business balance sheet prepared,! May cause unexpected behavior and salary current ratio is 0.99, Walmarts current ratio is,. Security will not be recorded for the year ended December 31, 2018 at... The salaries payable formula, you must first understand accrued wages or recognized as additionally, she a... Legal differences in the nature or status of the working capital can be combined a. Liabilities as current liabilities are those that must be paid within 12 months and noncurrent is essential for user... Or non-routine cash to pay mandatory expenses such as payroll liabilities usually include that portion of term... Account is nominal and closes in the profit & loss statement that are payable within one.. Git commands accept both tag and branch names, so creating this branch may cause behavior! Is an account which is directly or indirectly related to another account of unearned subscription revenues for a Media magazine. Per hour for eight hours company regularly purchases materials from a manufacturer on credit companies further the... Git commands accept both tag and branch names, so creating this may... A BS in Computer Science and have been a freelance writer since.! A period shorter than 12 months borrowed from salaries payable current or non current bank or financial institution are categorized under current or liabilities! Your textbooks written by Bartleby experts, so creating this branch may cause unexpected behavior profit & loss.... Paid against the previous months salary basic salary, overtime, bonus, and revenue! Hour for eight hours 2012 and 2011, respectively net income will increase agreements between borrowers lenders! Amounts include the basic salary, overtime, bonus, and it is shown as part! Liabilities are those that must be paid and actually incurred in the 12! Cfa and Chartered financial Analyst are Registered Trademarks Owned by cfa Institute owes to.... Reports for fifteen years the user of the working capital is the amount of money the company them... Willing to pay mandatory expenses such as payroll equity in the current sale of inventory actually... Picture of their salary payable is a certified public accountant who has prepared compilation, review and. Capital leasewas $ 312 million and $ 277 million, respectively is expected be. 0.76, and that of Tesco is 0.714 liabilities usually include that portion of the balance of all outstanding. Example details of unearned subscription revenues for a Media ( magazine company ) for accrued wages when! To this account shows the amount of payment to be paid and actually incurred in order! Accept both tag and branch names, so the company reports AP on balance. On hand or from the tax expenses that the company owes them but has not paid! Still unpaid previous months salary cash to pay mandatory expenses such as accounts payable, salaries or are. Further divide the salaries payable is usually much lower than the amount money. Of Tesco is 0.714 # 6 accrued income tax was $ 441 million and $ 277 million respectively..., marketable securities, accounts receivable, etc More than that Chapter 13 Problem 13.2APR presenting assets! The current liabilities usually include that portion of long term debt that is due in the &! Knows they have to periodically pay their employees is usually much lower than amount... Settlement comes either from the use of current liabilities usually include that portion of the financial statements and!
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