Course Outline

This course is intended to provide the requisite foundation knowledge in Financial Accounting at the beginning of the program to support subsequent subjects.

On completion of the course, attendees should be able to:

1. Understand the conceptual framework for financial accounting
2. Understand the essential accounting process and procedures
3. Explain the key accounting principles used in account preparation
4. Describe the accounting treatment for entries across the accounting spectrum
5. Understand the relationship between the key financial statements (income statement, cash-flow statement and balance sheet)

Course attendees should not be assumed to have any previous accounting and finance education or experience.

The course should have an emphasis on practical teaching methods and worked examples to support learning, including a number of assessed exercises and tests

Course Objectives

On completion of this course, trainees should be able to;

1. Understand the conceptual framework for financial accounting
   • Identify the qualitative characteristics of accounting information
   • Define the basic elements of financial statements
   • Explain the basic assumptions of accounting
   • Explain the basic principles of accounting
2. Understand the essential accounting process and procedures
   • Describe the concept of accounting periods and the reason for them
   • Explain the process of financial accounts preparation and verification

3. Explain the key accounting principles used in account preparation
   • Define revenue, cost of sales, operating expenses and non-operating expenses
   • Explain the difference between cash and non-cash expenses and where these differences will be seen in the financial statements
   • Define and identify key types of assets and liabilities, creditors, debtors and inventories
   • Explain the difference between tangible and intangible assets
   • Distinguish between ongoing operations and material items not representative of regular operations

4. Describe the accounting treatment for a range of business transactions
   • Explain the basis of accounting for inventories and describe the inventory cost flow methods (FIFO, LIFO and average cost)
   • Explain the accounting for tangible and intangible fixed assets – including valuation and depreciation methodologies
   • Understand the implications of foreign exchange variations with regards transactions in foreign currency
   • Explain the basis of accounting and valuation methods for receivables
   • Explain the basis of accounting and valuation methods for payables (including contingent liabilities)
   • Distinguish between operating and capital leases
   • Determine the necessary accounting entries for issuance of debt instruments such as bonds
   • Distinguish between operating, investing and financing activities in the respective financial statements
   • Differentiate between the various classes of stock issued by a company, and demonstrate the preparation of stockholder’s equity statement and dividends (cash and stock)
   • Prepare and analyse a statement of cash flows using both indirect and direct method

5. Understand the relationship between the key financial statements (income statement, cash-flow statement and balance sheet)
   • Explain the purpose of each of the key financial statements and summarize what information it provides the reader
   • Explain the key information elements on each of the key financial statements
   • Explain the relationship between each of the financial statements and the information contained within