Financial Accounting

This module is currently under review and minor changes will be updated on the web as soon as possible

Rationale:

Accounting is the process of classifying, measuring and communicating the economic transactions of business organisations. Accountants need to understand how this process is used to prepare financial statements for external users. They also need an understanding of reporting for limited companies and of how users of that information interpret the reports in order to make informed decisions.

Aims:

1. To introduce the accounting equation and fundamental accounting concepts.
2. To provide experience of basic book-keeping up to and including the preparation of profit and loss accounts and balance sheets for sole traders.
3. To prepare final accounts for limited companies manually and using accounting software.
4. To interpret the final accounts of organisations using ratio analysis

Anticipated Learning Outcomes:

On completion of the module, the student should be able to:

1. Define and explain basic accounting terminology, concepts and theory .
2. Apply accounting and numerical techniques, principles and procedures.
3. Analyse, interpret and solve problems using accounting and financial information.
4. Communicate effectively in writing.

Indicative Content:

• Introduction to accounting
• The accounting equation
• Preparation of a trial balance
• The nature of income, expenses, assets and liabilities.
• Capital and revenue expenditure
• Journal entries and correcting errors
• Preparation of a simple profit and loss account and balance sheet for a sole trader & partnership
• Preparation of more complex financial statements to include;
• Debtors and creditors (and control accounts); Bank reconciliation statements; Stock; Accruals; Prepayments; Depreciation
• Introduction to computerised accounting systems.
• Introduction to limited companies;
• The nature of shares; Retained profit; Revenue and capital reserves; Preparation of accounts for limited companies
• Introduction to reporting requirements for limited companies (including format)
• Incomplete records
• Introduction to cash flow statements
• Introduction to the interpretation of accounts

Skills Integration

Skills developed in this module will include numerical and IT skills, problem definition, problem analysis, problem solving and decision making. The use of information technology will be introduced through the CAL package (EQL), "Understanding Accounts", and will be developed through case study work using a computerised accounting software package (Sage).

Teaching and Learning Strategy and Methods

Topics and general principles will be introduced through lectures and directed study materials. The topics will be discussed and developed in seminars and the principles applied in practical exercises. Case studies may be used in the module and CAL packages will provide additional exercises.

Assessment and Feedback Strategy

Learning outcomes 1 to 4 will be assessed through the final examination. Learning outcomes 2 and 5 will be assessed through coursework. Course work will take the form of a comprehensive case study completed at a set time and date in a computer workshop. The weighting of coursework to final examination is 40% coursework and 60% final examination. This split reflects the fact that assessing outcome 5 can only be done in a computer workshop setting yet constitutes a substantial part of the syllabus.

Assessment Criteria

A table of assessment criteria (for students) and staff marking scheme will be prepared for each piece of the assessment (see example). These will show both students and staff how grades between "referral" (<35%) and "distinction" (70%+) are to be awarded.