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How Personal Statement Accounting Can Be Beneficial For You

Personal statement accounting is the accounting that is done for the personal purposes. The accounting method that is used in the preparation of the personal statement accounting is the accrual method rather than the cash method. The assets are shown at the estimated current values and listed in the order of the liquidity and the maturity with no classification as the current or non-current. Only the person’s interest as the beneficial owner is included and the liabilities are shown by the order of the maturity without any classification as current or non-current.

The personal statement accounting is very much beneficial for the people who want to maintain a keen eye on their finances. Whether the personal statement accounting is done in the joint manner or single manner, this type of accounting is very much beneficial.

Another thing that needs to be taken into account is the footnote disclosure that must include the following:

  • The individuals who are covered by the financial statements
  • The methods that are used in determining the current value
  • It also has to include the non-forfeiture rights that cannot be qualified as the assets
  • It also has to include the nature of the joint ownership of the assets
  • The amount of the life insurance that is covered
  • Methods as well as assumptions that are used to compute the income taxes
  • Noncancellable commitments that cannot be included in the liabilities
The personal statement accounting is relatively a new form of accounting. It can handle the financial management of the individual or the number of individuals that form the core of the personal statement accounting. It is essential that the accountant who is involved in the preparation of the personal statement accounting reports is a person with a lot of honesty as well as integrity. If the accountant is a qualified degree holder with the sufficient amount of experience then it would only be a good addition.