Introduction to accounting Essay Example | Topics and Well Written Essays - 750 words

Introduction to accounting - Essay Example Sun pharmaceutical is considered as one of the largest and also fastest growing pharmaceutical company of India. It’s most famous and powerful brands are handled by good marketing executives. Sun Pharmaceutical is the largest drug company of India; it earns revenue of around $4.3 billion. Accounting policies that are laid down require a selection of the accounting standard which is needed to be followed by the company and their application and estimation. Accounting policies affects the goodwill and intangible assets, the benefits provided to its employees, its acquisition. A consolidated Financial Statement is to be prepared and reviewed as they help in reflecting the operating, financing and investing activities of the company and also it helps in assistance of Employee Stock Option Plan for the employees working in the company. The expected return on the investment of the company and other planned asset should be estimated. Accounting policies will provide guidance to Sun P harmaceutical in the acquisition of Ranbaxy. Under the purchase method of the Consolidated Financial Statement it helps in the operation of an acquired business from it’s starting to its completion of acquisition. Fair value is very essential to be determined by the company for estimation of price of the product. Fair value is influenced by the Efficient Market Hypothesis and the intangible assets of the company that is the brand value or the goodwill of the company basically depends on the assumption of the expected future cash flow. The brand value of a product is a long term and it goes along with the company , therefore the brand value of a company is affected by number of factors product life cycle, market share, macroeconomic environment, market share, competitive environment of the countries in which the country is willing to sell the brand(Gary and Curtis 2014). Accountants are more