Registry
Module Specifications
Archived Version 2008 - 2009
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| Module Aims | |||||||||||||||||||||||||||||||||
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(a) To introduce students to the preparation of simple financial statements - income statements, statement of comprehensive income, statement of financial position, statement of changes in equity and statement of cash flows. (b) To develop the students’ ability to analyse, understand, critically evaluate and use financial statements. | |||||||||||||||||||||||||||||||||
| Learning Outcomes | |||||||||||||||||||||||||||||||||
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Students as users of accounting information should: (a) Be able to prepare simple financial statements. (b) Be able to interpret and evaluate financial statements and understand the uses and limitations of financial information. | |||||||||||||||||||||||||||||||||
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| NOTE | |||||||||||||||||||||||||||||||||
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Assume that a 7.5 credit module load represents approximately 112.5 hours' work, which includes all teaching, in-course assignments, laboratory work or other specialised training and an estimated private learning time associated with the module. | |||||||||||||||||||||||||||||||||
| Indicative Syllabus | |||||||||||||||||||||||||||||||||
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Introduction to Accounting: Definition of accounting, output of accounting - Primary Statements, Users of accounts, Financial Accounting v Management Accounting, qualitative features of financial accounting information. [CT2 - (viii) - 1]
Accounting Concepts and Conventions: Entity, going concern, prudence, accruals/matching, consistency, money measurement, historic cost, stable monetary unit, realisation, materiality, objectivity. Developments on the conceptual framework issue. [CT2 (viii) - 2]
Recording Business Transactions: Accounting equation and the balance sheet, accounting equation and the profit and loss account, double entry system for assets, liabilities and capital, profit and reserves. The Trial Balance. [CT2 (viii) - 3 and 4]
Preparation of accounts for sole traders: Simple adjustments such as accruals and prepayments, depreciation, bad debts; capital and revenue expenditure, revaluation of non-current assets. [CT2-(viii)- 4]
Introduction to Regulatory Framework for Company Final Accounts for publication: Primary statements of companies compared to those of sole traders; origin of joint stock company; private and public limited companies; discussion of Format of published accounts for a public limited company (plc) under revised IAS1; regulatory framework, annual report, true and fair view, small and medium companies, international and national accounting standard setting by professional bodies, role of stock exchange regulation, role of company legislation, role of directors, role of auditors. Developments in Corporate Governance. Review of international standards on inventory, property, plant and equipment and revenue recognition.
[CT2-(iii)- 1-5 and (viii)-1-3]
Statement of Financial Position for Companies: Characteristics of assets, capital, double entry rules, categories of assets and valuation including revaluation of non-current assets, categories of liabilities, types of share capital & types of reserves, preparation of statement of financial position for publication. Statement of Changes in Equity. Shortcomings of historical cost accounting. Interpretation of financial statements of a plc using annual reports and recognition of limitations of this interpretation. Creative accounting. [CT2-(iii)- 2-3 and (viii) 1-4, 9- 10 and (ix)-7 -9]
Comprehensive Income Statements for Companies: Recognition of revenue and expenses, accruals and prepayments, capital and revenue expenditure, depreciation, format of Comprehensive Income statement; flow of information, double entry rules, preparation of Comprehensive Income statement and of accounts for publication for plc companies. [CT2- (viii)-3-4, 9]
Statement of Cash Flows: Concept of cash flow, distinction between profits and cash flow, preparation of statement of cash flows under IAS 7. Interpretation of statement of cash flows, using written analysis [CT2- (viii)-4]
Interpretation of Accounts: Role of ratio analysis, computation of profitability, liquidity, efficiency, gearing, and investment ratios and interpretation of same by preparation of written analytical reports for plc companies. Link between Cash flow and Ratios and Working Capital Management. Limitations of ratio analysis in the interpretation of company accounts. Creative accounting. [CT2 (ix)- 1-9]
Group Accounts: Concept of group and preparation of a simple group balance sheet (Consolidated Balance Sheet). Concept of subsidiary and associate companies. Goodwill on consolidation. Review of Annual Report of Insurance Company
[CT2-(viii)- 5-8]
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| Indicative Reading List | |||||||||||||||||||||||||||||||||
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Recommended Text Financial Accounting (2006) by Mike Jones Relevant International Accounting standards as per lecture handout based on Elliott, B. and Elliott, J. Financial Accounting and Reporting, 12th edition, FT Prentice Hall. Supplementary Texts: Simple "easy to read" for the basics of accounting: Brett, Michael, How to figure out Company Accounts 2003, London: Texere Publishing Ltd (1-58799-033-4). Brett, Michael, How to read the Financial Pages, latest edition, London: Century Limited (0-7126 7560-4). Fitzgerald, Ray. You don't need an accountant, latest edition, Dublin: Blackhall Publishing Ltd. Note: The above texts are elementary and do not cover international accounting standards. www.iasplus.com-http://www.iasplus.com-/ for up to date developments in International Accounting Standards. | |||||||||||||||||||||||||||||||||
| Programme or List of Programmes | |||||||||||||||||||||||||||||||||
| FM | BSc in Financial & Actuarial Mathematics | ||||||||||||||||||||||||||||||||
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