{"ok":true,"canonical_url":"https://dealroom.so/glossary/financial-accounting","api_url":"https://dealroom.so/api/public/glossary/financial-accounting","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"financial-accounting","term":"Financial accounting","group":"Reading the business","definition":"This is the system of recording, summarizing, and reporting financial transactions for a business. It's how you understand the company's past performance and current health.","what_it_means":"You'll spend significant time reviewing the seller's financial accounting records (P&L, Balance Sheet) during due diligence. This data forms the basis for your projections and valuation. Understand how the seller's accounting practices might differ from standard GAAP.","url":"https://dealroom.so/glossary/financial-accounting","official_sources":[],"related":[{"slug":"profit-and-loss-statement","term":"Profit and Loss Statement","url":"https://dealroom.so/glossary/profit-and-loss-statement"},{"slug":"balance-sheet","term":"Balance Sheet","url":"https://dealroom.so/glossary/balance-sheet"},{"slug":"ebitda","term":"EBITDA","url":"https://dealroom.so/glossary/ebitda"},{"slug":"sde","term":"SDE","url":"https://dealroom.so/glossary/sde"}],"related_questions":[{"question":"What if the business I'm buying has poor financial records or no formal accounting system?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-m-buying-has-poor-financial-records-or-no-formal-accounting-system"},{"question":"How do shared administrative services, like HR or accounting, automatically trigger affiliation for size determination?","url":"https://dealroom.so/for-lenders/questions/how-do-shared-administrative-services-like-hr-or-accounting-automatically-trigger-affiliat"},{"question":"Does sharing common administrative services, like HR or accounting, automatically trigger affiliation for size determination?","url":"https://dealroom.so/for-lenders/questions/does-sharing-common-administrative-services-like-hr-or-accounting-automatically-trigger-af"},{"question":"Are pre-closing legal and accounting fees eligible to be counted towards my equity injection?","url":"https://dealroom.so/sba-7a/questions/are-pre-closing-legal-and-accounting-fees-eligible-to-be-counted-towards-my-equity-injecti"},{"question":"Can pre-closing legal and accounting fees associated with the acquisition be counted towards my equity injection?","url":"https://dealroom.so/sba-7a/questions/can-pre-closing-legal-and-accounting-fees-associated-with-the-acquisition-be-counted-towar"},{"question":"Can closing costs such as legal and accounting fees be included in the total project cost for the 10% calculation?","url":"https://dealroom.so/sba-7a/questions/can-closing-costs-such-as-legal-and-accounting-fees-be-included-in-the-total-project-cost-"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Financial accounting","url":"https://dealroom.so/glossary/financial-accounting","source_type":"DealRoom Data"}}