Accounting can be divided into two fields – financial accounting and management accounting. Financial accounting focuses on information for people outside the entity. Management accounting focuses on information for internal decision makers of an entity.
Chapter 1. accounting overview1
Introduction ofFinancial Accounting Chapter 1
Course objectives Develop knowledge and understanding of underlying principles, concepts and regulations relating to financial accounting. Use of double entry techniques Prepare financial statements
Course organisation Introduction of Accounting Statement of Financial Position The double entry recording process Middle exam Special Journals Cash Transactions Credit Sales and Credit Purchase Journals The General Journal The perpetual Inventory System Closing the General Ledger Statements of Financial Performance Statements of Cash Flow Depreciation of Non-Current Assets Profit Determination and Balance-Day Adjustments Final exam
Reference book Keith King, VCE Accounting Units 3 and 4, MacMillan Publisher 2002 Kimmel, Weygandt, Kieso, Financial Accounting Fourth Edition
Assessment2. Participation 10%3. Quizzes 15%4. The middle exam 25%5. The final exam 50%
Accounting... is an information system that... measures business activities, processes information, and... communicates financial information.
Accounting – information system Information identification Information recording Information analysis Information reporting
Accounting Activities Identifying Recording Business Business Activities Activities Communicating Business Activities
Accounting... is called the language of business.
Users of Accounting Information External users Internal users make decisions make decisions about the entity. for the entity.
Fields of Accounting Financial Accounting Management Accounting
• 1. Managerial accounting is concerned with providing information to managers and other internal users • 2. Financial accounting is concerned with measuring and communicating information about business activities to external users (Financial statements) Financial Accounting - Chapter 1 13
Financial and Management Accounting Financial accounting Management accountingReport nature General purpose Special purposeLevel of detail Aggregated DissectedRestrictions Standardised or Minimum regulated restrictionsReporting interval Less frequently More frequentlyTime horizon Backward looking Forward lookingRange of Primarily monetary Often non-monetaryinformation and objective with less objective constraints
Objective 2 Introduction to financial Statetment