INTRODUCTION TO FINANCIAL ACCOUNTING AND REPORTING

About this Course

This course is designed to provide a fundamental understanding of the basic accounting concepts, principles and techniques of double entry system, procedures in preparing financial statements of a sole trader for merchandising and service enterprise. This course aims to provide students with the basic accounting knowledge of the total recording process as well as maintenance of full set of accounts that a business organization should keep.

Course Learning Outcomes

1) Prepare financial statements and bank reconciliation statements using the basic accounting knowledge for a sole proprietorship business.
2) Work collaboratively with other students in completing the accounting simulation project.
3) Analyse financial statements using simple financial ratios for sole proprietorship business.

Course Syllabus

+ Course Syllabus

1) Introduction to Accounting
Definition of accounting
Functions of financial statements
Main user groups of financial statements
Accounting cycle
Various forms of business entities

2) Introduction to qualitative characteristics of useful financial information and other accounting assumptions and concepts
Fundamental qualitative characteristics
--Relevance
--Faithful representation
Enhancing qualitative characteristics
--Comparability
--Verifiability
--Timeliness
--Understandability
Other accounting assumptions and concepts
--Going concern
--Historical cost
--Entity
--Money measurement

3) Accounting equation and accounting classification
Statement of financial position format and its elements
Basic accounting equation
Effects of transactions on the basic accounting equation
Expanded accounting equation
Effects of transactions on the expanded accounting equation

4) Principles of double entry
Double entry rules
Ledger entries
Balancing off ledger accounts
Pre-adjusted trial balance
Pre-adjusted financial statements

5) Books of prime entry
Introduction to source documents
Types of journals
Types of ledgers
Recording process from source documents to journals and posting to ledgers

6) Balance day adjustments and preparation of financial statements
Adjustments of accruals and prepayments
Bad debts and bad debts recovered
Doubtful debts and allowance for doubtful debts
Capital expenditure and revenue expenditure
Depreciation of non-current assets
Post-adjusted financial statements
Application of financial accounting

7) Bank reconciliation statement
Use of banking facilities for safe keeping of cash (bank account)
Update Cash Book
Reconciling the bank account with the bank statement

8) Financial statements analysis
Objectives of financial statements analysis
Types of financial ratios analysis
Preparation and interpretation of financial ratios
Limitations of financial ratio analysis

Frequently Asked Questions

There is no FAQ yet available in this course.