Wikipedia is a good source of infor­mation about a variety of topics. I’m pleased to find that it’s generally pretty good about accounting too.

The article on the Balance Sheet contains “case studies” showing the effect of some trans­ac­tions on a very basic balance sheet.

As well, I’d never seen non-current liabil­ities referred to as “fixed” liabil­ities before, although I’m familiar with “fixed assets.” Guess I’d just never considered the contra terminology!

It makes sense though, given that they result in fixed costs to the business, in general.

The article on the Income Statement shows some examples from Colgate-Palmolive and Viacom and gives instruc­tions on calcu­lating earnings-per-share.

Pensions have been in the news lately, with FASB announcing revised standards regarding the funded status of defined benefit plans.

Wikipedia’s pension entry provides a solid description of the two types of pensions, defined benefit and defined contribution.

I learned something new on the pension page as well:

In an unfunded defined benefit pension, no assets are set aside and the benefits are paid for by the employer or other pension sponsor as and when they are paid. Pension arrange­ments provided by the state in most countries in the world are unfunded, with benefits paid directly from current workers’ contri­bu­tions and taxes.

It’s not surprising to find out we don’t learn how to account for these types of pensions in school. It’s basically pensions on a cash basis. Pay the cash, recognize the expense.

Poor matching of expenses to the revenue they helped generate — which is no doubt why govern­ments are the only organi­za­tions that get to use this type!

Have you ever contributed to Wikipedia?