Damain Unogu and Co.

24/08/2020

28/07/2020

Here's a simple story that illustrates the difference between Profit and Cash.

Too many business owners confuse them. They believe that Profits equals cash.

PICTURE THIS!
HARLEY bought a bag of potatoes for N8,000 and sold it to ZOE for N12,000.
But ZOE paid only N2,000 and promised to pay the balance of N10,000 in two weeks.
HARLEY’S profit is N4,000.
HARLEY only has N2,000 in cash; even though his profit is N4,000.
Using this simple example, it is clear that PROFIT is not CASH.

Dear business owner, Profit is the excess of sales over costs; it is not necessarily the same as cash.

Yes, in some instances, Profit may equal cash; where all customers have paid up and the business has not made any expenses out of the money. This is however very rare.

It is also possible to make a Profit and have no Cash because the customer(s) has not made payment.

We hope this simple example explained it perfectly to you.
Do you now understand that Profit is not Cash?

So the next time you hear a business owner saying, “I made a lot of sales this month, now it’s month-end and I have no cash; please tell the person that Profit and Cash are very different.

17/07/2020

Audit committee is made up of directors and the shareholders representatives of a company whose specific responsibility is to review the annual financial statement before submission to the board of directors.

The committee is usually subject to the maximum number of 6 individuals. Any member may nominate a shareholder as a member of the committee by giving notice in writing of such nomination to the secretary of the company at least 21 days before the annual general meeting.

The functions of the audit committee include:

1. Make recommendation to the board regarding appointment, removal and remuneration of the company's auditor.

2. Authorize the internal auditor to carry out investigation into any activity of the company

3. Review the findings of the management letters in conjunction with external auditors and departmental responses

4. Keep under close review the effectiveness of the system of account and internal control

5. Review the scope and planning of audit requirement

6. Ascertain whether the account and reporting policies of the company are in accordance with the legal requirement and agreed ethical practices.

05/06/2020

21/04/2020

What is Compound Interest?
Compound interest is the accumulated interest from previous investment plus the initial principal. It is the result of reinvesting interest so that the interest in the next period is then earned on the principal sum plus previously accumulated interest. While we are most familiar with simple interest, there is a difference between them. Both types of interest will grow your money over time, but specifically, simple interest is only paid on principal, while compound interest is paid on the principal plus all of the interest that has previously been earned, unlike simple interest, which covers one period.

20/04/2019

Auditing in two Scopes.