Riverstone Training

The classification of lease in financial accounting is the procedure of identifying how a lease set up ought to be acknowledged and recorded in the record. This classification has an impact on the manner, in which assets, liabilities, expenses, and cash flows are presented, hence it is a very important area of financial reporting. The classification of lease in financial accounting assists financial statements users in realizing whether or not a lease conveys substantial economic advantages and risks to the lessee or whether it is simply a rental agreement. Riverstone Training reiterates that proper classification of leases is necessary to achieve transparency, compliance, as well as comparability in financial reporting. Practically, the lease classification, as described in financial accounting, would have an impact on the balance sheet and income statement. A put down the wrong lease will be flipped, leverage ratios, measures of profitability, and measures of the utilization of the ...

The use of coefficient of variation in interpreting results to make a decision is vital in the comparative study of the relative risk or consistency of various data sets. The difference in the coefficient of variation indicates variability in terms of the mean and this enables the decision-makers to interpret the variability in terms of its proportion to average performance. Riverstone Training stresses the interpretation of result of coefficient of variation to aid in decision making, assists managers, analysts and investors to assess uncertainty in a more objective way, where absolute values may be misleading themselves. Practically, the effects of interpretation of coefficient of variation results in decision making enable organizations to make comparisons of options of various magnitudes, including investment returns, or cost structures, or operational performance measures. A smaller coefficient of variation normally represents a more stable result whereas a larger coefficient sig...

The basic question in managerial accounting and financial management is what is contribution margin and why it is relevant in making business decisions. Contribution margin is the amount of sales revenue that is left after deducting variable costs and this amount helps in the covering of the fixed costs and profit generation. Knowing what contribution margin is and why it is important in business decisions would enable managers to have a clear picture of the impact of sales volume and cost structure on the overall profitability. Riverstone Training points out that contribution margin is a convenient tool of assessing short term decisions like pricing, mix of products and capacity utilization. The question of contribution margin and its importance in business decision-making is of particular importance in business when managers have a trade-off to make. As an illustration, contribution margin when making a decision on accepting a special order that is priced lower will allow one to det...

Financial analysis technique is vertical analysis of the balance sheet as a percentage of total assets, which converts every balance sheet item into percentage of total assets. This process enables analysts to comprehend the arrangement of the financial position of a company in the sense that it indicates how the assets are financed and distributed. Riverstone Training says that vertical analysis of balance sheet as a percentage of total assets facilitates the standardization of the financial statements, thus it is easy to compare companies of various sizes or to compare the changes in the same company across time. In practice, a vertical balance sheet analysis as the percentage of the total assets allows noting the dependence of the company on the debt or equity financing and the efficiency of the allocation of the resources. As an illustration, a high ratio of current assets can be used to suggest high levels of liquidity and large percentage of fixed assets can be used to suggest c...

Amortization and depreciation were described in accounting and finance as the two main concepts that are applied in an effort to spread the cost of assets in terms of their useful lives. Depreciation is relevant to tangible assets like machinery, buildings, and equipments but amortization is relevant to intangible assets like patents, trademarks and software. The knowledge of amortization and depreciation as used in accounting and finance can assist businesses in putting the cost of assets in line with the earnings that such assets aid in generating over the years. Riverstone training insists that the correct use of these concepts is critical in the correct financial reporting as well as making of good financial decisions. Pragmatically, amortization and depreciation discussed in accounting and finance make sure that expenses are recorded in a systematic manner and not recorded at once. This would stop the exaggeration of profits during the year of acquisition of an asset and would sh...

Financial machine learning has become an important resource in financial institutions and enterprises to predict future trends, risk assessment, and detect fraudulent activities. Machine learning models have the capability to discover patterns that may be hard to detect by humans by processing vast amounts of historical and real time data. Financial machine learning to forecast and analyze risks as well as detect frauds is typically employed to forecast the trend in the market, estimate future cash flows, and evaluate the financial risks involved. Besides that, machine learning in finance to predict, risk analysis, and fraud detection significantly contributes to suspicious transaction recognition. Fraud detection algorithms are used to detect suspicious behavior and identify possible fraud as it occurs. Organizations can make better decisions based on data, minimize losses and make faster decisions with the use of machine learning in finance by forecasting, risk analysis and fraud de...