Chapter 1 – Accounting fundamentals
- The nature, purpose and role of accounting
- Branches of accounting
- Accounting terms – assets, liabilities, income, expenditure etc
- Basic concepts – the business entity, underlying assumptions, accounting equation
- Users of accounting information and their needs – to include qualitative characteristics
Chapter 2 – The business plan- Preparing a plan to present to a bank/financier
- Appreciation of costs and cost structures
- The concept of breakeven
- The basics of budgeting and planning
Chapter 3 – Financing
- Sources of finance
- Financing options, costs, advantages/disadvantages
Chapter 4 – Keeping the books
- Source documents and records
- Books of original entry
- Computerised entry
Chapter 5 – Double entry accounting system
- Principles of the double-entry system
- Nominal and personal ledgers
- Control accounts – explanation and purpose
- The trial balance – preparation and purpose
Chapter 6 – Income statement and Balance Sheet (sole trader)
- Preparation of basic income statement and balance sheet from trial balance
- Would introduce revenues, expenditures, accruals, depreciation, stock valuation
- Layout of the financial statements
Chapter 7 – Accounts of limited companies
- Differences, additional requirements
Chapter 8 – Cash Flow Statement
- Preparation of a cash flow statement
Chapter 9 – Interpretation of financial statements
- Need to interpret accounts
- Usefulness and application of ratio analysis
- Main accounting ratios; relationships between ratios
Chapter 10 – valuation of companies
- Book v market value
- Some simple valuation methods
