Silibus Bkaf1023

COLLEGE OF BUSINESS (ACCOUNTANCY PROGRAMME) UNIVERSITI UTARA MALAYSIA COURSE CODE COURSE PRE-REQUISITE

1.0

: : :

BKAF1023 INTRODUCTION TO FINANCIAL ACCOUNTING NONE

SYNOPSIS This course aims at introducing students to the fundamentals of bookkeeping and principles of financial accounting. It explains the accounting equation, identifies steps to complete the accounting cycle and discusses the role of accounting records in organization. It further explains the differences between cash and accrual accounting, the nature of general purpose financial accounting statements, the role of accounting information in making economic decisions and discusses the significance of accounting systems in providing relevant and reliable information. It also exposes students to financial statement analysis and interpretation of financial ratios.

2.0

OBJECTIVES Upon completion of the course, students are expected to: 2.1 To enable students to understand accounting principles and the function of financial reports and how accounting functions as the language of business and how accounting information assist in making decisions. 2.2 To assist students in financial information analysis and usage of financial information extracted from the annual reports.

3.0

LEARNING OUTCOMES After completing the course, students should be able to: 3.1 Explain the accounting principles and the role of accounting reports. 3.2 Explain the concept of accrual accounting and why it is used. 3.3 Use double entry system of accounting to record business transactions.

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3.4 Preparing adjusting entries and closing entries and basic financial statements. 3.5 Prepare bank reconciliations and explain basic procedures for internal control of cash. 3.6 Prepare financial statement for partnership. 3.7 Perform financial statements analysis using relevant financial ratios and make appropriate interpretations based on information available and analysis. 4.0

REFERENCES Main Reference Larson, K.D., Wild, J.J., & Chiappetta.B., Ropidah,O., Haslinda,H., Aryati J.S., & Liana, M., (2007), Accounting Principles, 2nd Edition. Mc Graw Hill:Malaysia. Additional References Horngren, C.T., & Harrison, W.T. (2007). Accounting, 7th Edition. Pearson : US Thomas, A. (2006). Introduction to Financial Accounting, 5th Edition. McGraw Hill Education: Asia. Ng, E. J., (2006). A Practical Guide to Financial Reporting Standards (Malaysia). CCH Asia Pte Limited: Singapore Weygandt, J.J., Kieso, D.E., & Kimmel, P.D. (2003). Financial Accounting, 4th Edition. John Wiley. Wild, J. J. (2003). Financial Accounting: Information for Decisions, Edition McGraw-Hill Company: New York.

2nd

Weygandt, J.J., Kieso, D.E., & Kimmel, P.D.(2002). Accounting Principles, 7th edition. John Wiley. Garrison, R.H. & Noreen, E.W.(2000). Managerial Accounting, 9th edition. McGraw Hill. Malaysian Accounting Standard Board (2006). Financial Reporting Standards (FRS101). Ninth Schedule, Companies Act 1965.

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5.0

COURSE CONTENT NO / WEEK

1.0 (Week 1)

TOPIC ACCOUNTING ENVIRONMENT

LEARNIN G LEVEL*

HOUR

1,2

3

1,2

3

1,2,3,4

3

1.1 What is Accounting 1.2 Accounting Profession 1.3 Process and flow of accounting information 1.4 Accounting as a business language 1.5 Internal and External users of Accounting Information 1.6 Financial accounting vs Management accounting 1.7 Generally Accepted Accounting Principles (GAAP) 1.8 Professional Accounting Bodies and Standard Setting in Malaysia 1.9 Statutory and Capital market requirements - Companies Act 1965 (Revised) - Bursa Malaysia Listing Requirements - Financial Reporting Act 1997 1.10 International Accounting Standards Board (IASB) 1.11 Financial Statements - Income Statement - Owner’s Equity Statement - Balance Sheet - Cash Flow Statement 2.0 (Week 2)

ACCOUNTING AND BUSINESS 2.1 Nature and characteristics of business activities 2.2 Definition of assets, liabilities, owner’s equity, revenue and expenses. 2.3 Cash accounting vs accrual accounting 2.4 Accounting principles.

3.0 (Week 3)

ACCOUNTING EQUATION AND FINANCIAL STATEMENT 3.1 Concept and accounting equation 3.2 Effect of business transaction on accounting equation 3.3 Financial statement preparation

3

4.0 (Week 4)

RECORDING TRANSACTION 4.1 Accounts 4.2 Double-entry system 4.3 Balancing off account 4.4 Journal 4.5 Ledger accounts 4.6 Trial balance

1,2,3,4

3

5.0 (Week 5)

MEASUREMENT OF BUSINESS INCOME 5.1 Expenses and revenue concept 5.2 Permanent and temporary account 5.3 Accounting cycle

1,2,3,4

3

6.0 (Week 6)

RECORDING YEAR END ADJUSTMENTS AND PREPARING FINANCIAL STATEMENTS (FRS101) 6.1 Types of adjusting entries 6.2 Adjustment process 6.3 Preparing worksheet: trial balance, adjusting entries, adjusted trial balance, financial statements

1,2,3,4

CORRECTION OF ERRORS 7.1 Types of errors 7.2 Errors revealed by trial balance and their corrections 7.3 Errors requiring more than two entries

1,2,3,4

3

1,2,3,4

6

7.0 (Week 7)

8.0 (Week 8 & 9)

ACCOUNTING FOR MERCHANDISING AND MANUFACTURINGS OPERATIONS ACCOUNTING FOR MERCHANDISING OPERATIONS 8.1 Merchandising Transactions - Purchase and Sales - Purchase Discounts - Purchase Returns and Allowances - Freight Costs 8.2 Recording the Transaction - Periodic Inventory System - Perpetual Inventory System 8.3 Adjusting Entries 8.4 Financial Statement 8.5 Closing Entries 8.6 Post-Closing Trial Balance

4

3

ACCOUNTING FOR MANUFACTURINGS OPERATIONS 8.7 Environment for Manufacturing Operation 8.8 Manufacturing Cost Concept 8.9 Product Cost v. Period Cost 8.10 Financial Statements for Manufacturing Firms 9.0 (Week 10)

INTERNAL CONTROL & CASH MANAGEMENT 9.1 Characteristics of effective internal control system and internal control for cash 9.2 Petty cash imprest system 9.3 Accounting for cash 9.4 Bank reconciliation statement

1,2,3,4

3

10.0 (Week 11)

ACCOUNTING FOR PARTNERSHIP 10.1 Characteristics of partnership 10.2 Financial statements of partnership

1,2,3,4

3

11.0 (Week 12)

ACCOUNTING FOR COMPANIES 11.1 Classification of companies 11.2 Company formation 11.3 Structure of company’s share capital 11.4 Types of shares and debentures

1,2,3,4

3

12.0 (Week 13 &14)

13.0 (Week 14)

FINANCIAL STATEMENT ANALYSIS 12.1 Basics of Financial Statement Analysis 12.2 Horizontal Analysis 12.3 Vertical Analysis 12.4 Ratio Analysis: - Liquidity Ratios - Profitability Ratios - Solvency Ratios 12.5 Analysis using Excel 12.6 Interpretation of Analysis Results 12.7 Limitation of ratio analysis COMPREHENSIVE CASE STUDIES & COMPUTER TEST 13.1 Accounting data analysis using Excel. - Preparing input data / Financial Statement - Creating formula for each of the ratios - Preparing the output / explanation / interpretation

5

1,2,3,4,5,6

1,2,3,4,5,6

3

3

* Learning Levels (Bloom’s Taxonomy) 1. Knowledge 4. 2. Comprehension 5. 3. Application 6.

Analysis Synthesis Evaluation

6.0 ASSESSMENT Course Work: Quizzes Tutorials Project Mid Sem Examination Final Examination

5% 5% 10% 20%

40% 60% 100%

7.0 TEACHING METHODOLOGY This course is conducted for fourteen weeks, comprising of three hours of lecture and one hour of tutorial class per week. The teaching and learning activities include group discussion, tutorials, assignments, students’ presentation, case studies as well as quizzes given from time to time throughout the semester. Power-point presentation or overhead slides for the lectures are available on the e-learning website or lecturer’s web site. Meanwhile tutorial questions are selected from the textbook. 8.0 ATTENDANCE Students are required to fulfill at least 80% of class attendance in order to qualify them to take the final examination as governed by the Universiti Utara Malaysia regulations. Students who fail to meet the above requirements for whatsoever reasons will be barred from taking the final examination. 9.0 ACADEMIC DISHONEST Candidates who are accused of academic dishonesty will face the University Board of Academic Misconduct. Students are reminded that academic dishonesty is the most serious academic offence. Examples of academic dishonesty are cheating and plagiarism, bringing in notes during examination, taking the examination on behalf of another student and so on. Once the student is convicted of the above offence, the examination result will be withheld and annulled and/ or other serious penalties may be taken against the student.

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