PlanComptable.com
ACCOUNTS
II. Functioning of accounts
Class 1. Equity and liabilities

12. Profit or loss for the financial year

 

Account 12 " Profit or loss for the financial year " records the balance of the expense accounts and the revenue accounts for the financial year.

A credit balance in account 12 represents a profit, as revenues exceed expenses.

A debit balance in account 12 represents a loss, as expenses exceed revenues.

Account 12 is balanced after the decision to allocate the profit or loss. In companies, amounts not distributed and not allocated to a reserve account are transferred to account 11 " Retained earnings ", to account 110 in the case of a profit brought forward, and to account 119 in the case of a loss brought forward, if these accounts are open. At the opening of the accounts for the following year, entities have the option of using a special account 88 " Profit and loss pending appropriation " . In sole proprietorships, the balance of account 12 is transferred to account 101 " Sole proprietor's capital " .

Entities may use account 120 " Profit for the financial year " to record the profit and account 129 " Loss for the financial year " to record the loss. They may use accounts 121 to 128 as they see fit, for example, to measure income statement performance indicators.

 

 
Website not affiliated with the Accounting Standards Authority (Autorité des Normes Comptables, ANC)
© 2004-2024 PLANCOMPTABLE.COM
Main page - Summary of accounts - Chart of accounts - Accounts - Financial statements - Accounting terms
Unofficial translation - Legal notices