Introduction to Accounting

An introduction to the disciplines of financial and management accounting.

By the end of this module the student should be able to:

1. Discuss contemporary financial accounting issues.
2. Draw up summary financial statements for a sole trader.
3. Discuss contemporary management accounting issues.

1 Introduction to Financial Accounting & Management Accounting

Introduction to Financial Accounting and Management Accounting; Accounting Theory and Practice: Different branches of accounting; Characteristics of financial information for operational, managerial and strategic levels within organisations; Differences between the role of Financial and Management Accounting.

2 Different Types of Business Organisation

The key concepts in financial accounting and the regulatory framework of financial accounting.

3 Basic Financial Accounting Practice

Preparation of accounting records and accounting entries for errors; Production of Income Statement and Balance Sheet for a sole trader including basic adjustments (accruals, prepayments, bad debts, allowance for doubtful debts, inventories), and financial ratios; Preparation of bank reconciliations;

4 Cost behaviour and measuring operational performance

Identification and classification of costs and revenues and understanding implications of cost behaviour. Using marginal costing to support short-term decision- making. Measuring relevant costs and revenues for decision-making; limiting factors, discontinuation, make or buy and other short-term decisions. CVP Analysis for a single product.

5 Budgets for Planning, Control and Decision-making

The budgeting process. Preparation of Cash budgets. Behavioural aspects of budgeting. Sources of management information.