The main objective of this unit is to obtain a practical understanding of financial accounting and the process behind the preparation of financial statements for single entities.
These statements are prepared within a conceptual and regulatory framework requiring an understanding of the role of legislation and of accounting standards. The need to understand and apply necessary controls for accounting systems, and the nature of errors is also covered. There is an introduction to measuring financial performance with the calculation of basic ratios.
Note: Students are required to be aware of the format and content of published accounts but are not required to prepare them. No detailed knowledge of any specific accounting treatment contained in the International Financial Reporting Standards (IFRSs) – including the International Accounting Standards (IASs), – is necessary, except in terms IAS 2 and the treatment of inventory, IAS 16 and IAS 38 for basic non-current asset transactions.
IAS 1 and IAS 7 formats will form the basis of the financial statements. The terminology used for all entities will be that of International Financial Reporting Standards. This will enable students to use a consistent set of accounting terms throughout their studies.
The learning goals associated with this unit are to:
There will be a mock examination and a two hour computer based assessment, comprising 60 compulsory objective test questions. Short scenarios may be given to which one or more objective test questions relate.