image missingTrue Value Metrics (TVM)
Meaningful Metrics for a Smart Society
image missing Navigation ... HOME
HOME BRIEF PROBLEMS
POSSIBILITIES
SYSTEM
OVERVIEW
PROGRESS
PERFORMANCE
STATE
CAPITALS
FLOW
ACTIVITIES
FLOW
ACTORS
EFFECTIVE
MANAGEMENT
PETER
BURGESS
SiteNav SitNav (1) SitNav (2) SitNav (3) SitNav (4) SitNav (5) SitNav (6) SitNav (7) SitNav (8)
Date: 2019-10-18 Page is: DBtxt001.php L0700-CC-ACCTGforSTATE

CORE CONCEPTS
ACCOUNTING FOR STATE ... THE BALANCE SHEET
MONEY WEALTH / MONETIZED VALUE
Money / Profit growth / GDP growth / Stock Prices / Cost push inflation / Wages chasing prices

STATE (BOP)
The balance sheet at the beginning of the period (BOP) puts on the record the state of affairs at this particular moment in time.
In conventional financial accounting the state of various money accounts are tabulated and a balance sheet created.
The same conceptual framing may also be used for all the values associated with the socio-enviro-economic system with numbers representing the state of all of the capitals ... the Social Capitals, the Natural Capitals and the Economic Capitals, of which Financial Capital is one part.

STATE (EOP)
The balance sheet at the end of the period (EOP) puts on the record the state of affairs at this particular moment in time.
In conventional financial accounting the state of various money accounts are tabulated and a balance sheet created.
The same conceptual framing may also be used for all the values associated with the socio-enviro-economic system with numbers representing the state of all of the capitals ... the Social Capitals, the Natural Capitals and the Economic Capitals, of which Financial Capital is one part.

PROGRESS / CHANGE IN STATE
The progress in a period is the improvement in the balance sheet between the beginning of the period (BOP) and the end of the period (EOP).
In conventional financial accounting the change in the state of the money balance sheet is the same as the profit for the period. This is a very useful concept and helps to ensure that the accounting correctly reflects the underlying transactions.
TPB Note: My observation going back several decades is that the training for UK accountants differs from that of US accountants in that there is more emphasis given to balance sheet analysis in the UK while the US has more focus on the P&L account, and the related cash flow statements. In my own experience, I have uncovered serious accounting problems because of balaance sheet analysis which just could not be reconciled with the visible realities.
Because socio-enviro-economic analysis is very complex, using balance sheet changes enables major simplification without changing in any way the basic rigor of progress measurement.

For more on this: L0700-CC-FLOW-PROCESS-CHANGEinSTATE
Open L0700-CC-FLOW-PROCESS-CHANGEinSTATE



The text being discussed is available at

SITE COUNT
Amazing and shiny stats
Blog Counters Reset to zero January 20, 2015
TrueValueMetrics (TVM) is an Open Source / Open Knowledge initiative. It has been funded by family and friends plus donations from well wishers who understand the importance of accountability and getting the management metrics right. TVM is a 'big idea' that has the potential to be a game changer leveling the playing field so the wealth and power is shared on a more reasonable basis between people who work for a living and those that own the economy and the levers of power. In order to be effective, it cannot be funded in the conventional way with a for profit business plan, but absolutely must remain an open access initiative.
WE WANT TO MAINTAIN AN OPEN KNOWLEDGE MODEL
A MODEST DONATION WILL HELP MAKE THAT HAPPEN


The information on this website may only be used for socio-enviro-economic performance analysis, personal information, education and limited low profit purposes
Copyright © 2005-2019 Peter Burgess. All rights reserved.