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Mining Wikipedia for accounting topics

Wikipedia logoWikipedia 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?