Financial Accounting for Decision Makers, 10th Edition
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For Financial Accounting modules on undergraduate and MBA courses.
Understand financial accounting principles and techniques, and develop skills to make informed business decisions
Financial Accounting for Decision Makers, 10th edition, by Atrill & McLaney focuses on how financial statements and information can be used to improve decision making.
When used in conjunction with the MyLab Accounting package this is an excellent resource to build a non-technical understanding of financial accounting.
Graham McDonald CA CFA, Senior Lecturer, University of Roehampton
An introductory financial accounting textbook in which theory is simplified and enhanced by real-world views and examples illustrating many applications in prominent businesses facing contemporary challenges, including the Covid-19 pandemic.
Dr Paola M. Madini, Lecturer in Accounting, University of Kent
My many students and I have used this book for years now and would highly recommend it to anyone looking for a very accessible introduction to financial reporting.
Dr Andrew McFaull, Deputy Programme Director of BSc Accounting and Finance, King's College London
Clear introduction to key principles offinancial accounting and the role of an accountant in businesses
Enable group-work and individual learning & revision with helpful pedagogical features woven into the text
Instructors, pair this text withMyLabAccounting
MyLab is the teaching and learning platform that allows instructors to reach every student with powerful self-study material and assessments. By combining trusted author content with digital tools and a flexible platform,MyLabpersonalisesthe learning experience and improves results for each student.MyLabAccounting for this edition includes over 1200 questions that can be assigned to students as practice or formative or summative assessment.
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BRIEF CONTENTS
Preface
How to use this book
Appendix A Recording financial transactions
Appendix B Glossary of key terms
Appendix C Solutions to self-assessment questions
Appendix D Solutions to critical review questions
Appendix E Solutions to selected exercises
Index
CONTENTS IN FULL
Preface
How to use this book
1.Introduction to accounting
Introduction
Learning outcomes
What is accounting?
Who are the users of accounting information?
The conflicting interests of users
How useful is accounting information?
Providing a service
Weighing up the costs and benefits
Accounting as an information system
Management accounting and financial accounting
Scope of this book
The changing face of accounting
Accounting for business
What is the purpose of a business?
What kinds of business ownership exist?
How are businesses organised?
The quest for wealth creation
Meeting the needs of other stakeholders
Balancing risk and return
Accounting for ethics
Not-for-profit organisations
Summary
Key terms
References
Further reading
Critical review questions
2.Measuring and reporting financial position
Introduction
Learning outcomes
The major financial statements an overview
The statement of financial position
The effect of trading transactions
Classifying assets
Classifying claims
Statement layouts
Capturing a moment in time
The role of accounting conventions
Money measurement
Valuing assets
Meeting user needs
Self-assessment question
Summary
Key terms
Reference
Further reading
Critical review questions
Exercises
3.Measuring and reporting financial performance
Introduction
Learning outcomes
The income statement
Different roles
Income statement layout
Further issues
Recognising revenue
Recognising expenses
Profit, cash and accruals accounting
Depreciation
Costing inventories
Trade receivables problems
Uses and usefulness of the income statement
Self-assessment question
Summary
Key terms
Further reading
Critical review questions
Exercises
4.Accounting for limited companies (1)
Introduction
Learning outcomes
The main features of limited companies
Legal safeguards
Public and private companies
Taxation
The major financial statements an overview
The statement of financial position
The effect of trading transactions
Classifying assets
Classifying claims
Statement layouts
Capturing a moment in time
The role of accounting conventions
Money measurement
Valuing assets
Meeting user needs
Self-assessment question
Summary
Key terms
Reference
Further reading
Critical review questions
Exercises
5.Accounting for limited companies (2)
Introduction
Learning outcomes
The directors duty to account
The need for accounting rules
Sources of accounting rules
Problems with standards
Accounting rules or accounting choice?
The need for a conceptual framework
The IASB framework
The auditors role
The framework of annual financial reports
Presenting the financial statements
Management commentary
Directors report
Strategic report
Accounting standards and accounting policies
Creative accounting
Self-assessment question
Summary
Key terms
References
Further reading
Critical review questions
Exercises
6.Measuring and reporting cash flows
Introduction
Learning outcomes
Why is cash so important?
The statement of cash flows and its relation to the other financial
statements
The relationship between the financial statements
The main features of the statement of cash flows
A definition of cash and cash equivalents
The layout of the statement of cash flows
The normal direction of cash flows
Preparing the statement of cash flows
Reconciliation of liabilities from financing activities
What does the statement of cash flows tell us?
Problems with IAS 7
Self-assessment question
Summary
Key terms
Reference
Further reading
Critical review questions
Exercises
7.Recognisingand reporting assets and liabilities
Introduction
Learning outcomes
Provisions, contingent liabilities and contingent assets
Provisions
Contingent liabilities
Contingent assets
Internally generated intangible assets
Leases
Borrowing costs
Self-assessment question
Summary
Key terms
Further reading
Critical review questions
Exercises
Appendix: Time value of money
8.Analysing and interpreting financial statements (1)
Introduction
Learning outcomes
Financial ratios
Financial ratio classifications
The need for comparison
Calculating the ratios
A brief overview
Profitability
Efficiency
Relationship between profitability and efficiency
Liquidity
Operating cash cycle
Financial gearing
Self-assessment question
Summary
Key terms
Further reading
Critical review questions
Exercises
9.Analysing and interpreting financial statements (2)
Introduction
Learning outcomes
Investment ratios
Financial ratios and the problem of overtrading
Key performance indicators
Common-size financial statements
Trend analysis
Using ratios to predict financial failure
Limitations of ratio analysis
Self-assessment question
Summary
Key terms
References
Further reading
Critical review questions
Exercises
10.Reporting the financial results of groups of companies
Introduction
Learning outcomes
What is a group of companies?
How do groups arise?
Types of group relationship
Preparing a consolidated statement of financial position
Inter-company assets and claims
Goodwill arising on consolidation and asset carrying amounts
Preparing a consolidated income statement
Inter-company trading
The statement of comprehensive income
Consolidated statement of cash flows
Accounting for less than a controlling interest associate companies
The argument against consolidation
Self-assessment question
Summary
Key terms
Further reading
Critical review questions
Exercises
11.Increasing the scope of financial reporting
Introduction
Learning outcomes
The development of financial reporting
From stewardship to decision making
Segmental financial reports
Summary financial statements
Interim financial statements
The value added statement
Accounting for inflation
Self-assessment question
Summary
Key terms
References
Further reading
Critical review questions
Exercises
12.Governing a company
Introduction
Learning outcomes
Corporate governance
The board of directors
The UK Corporate Governance Code
Tasks of the board
Chairing the board
The role of non-executive directors
The audit process
Remunerating directors
Performance measures
Assessing board performance
The rise of shareholder activism
Self-assessment question
Summary
Key terms
References
Further reading
Critical review questions
Exercises
Appendix A Recording financial transactions
Introduction
Learning outcomes
The basics of double-entry bookkeeping
Recording trading transactions
Balancing accounts and the trial balance
Preparing the financial statements (final accounts)
The ledger and its division
Summary
Key terms
Further reading
Exercises
Appendix B Glossary of key terms
Appendix C Solutions to self-assessment questions
Appendix D Solutions to critical review questions
Appendix E Solutions to selected exercises
Index
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Atrill & McLaney
©2022 | Pearson | 632 pp
Peter Atrill is a freelance academic and author who has worked with leading institutions in the UK, Europe and South-East Asia. As well as working as a business consultant, he was previously Head of Business and Management and Head of Accounting and Law at Plymouth Business School, University of Plymouth.
Eddie McLaney is an academic author with many years experience of teaching Accounting and Finance. He was formerly the Accounting Subject Group Leader and Principal Lecturer in Accounting and Finance at Plymouth Business School, University of Plymouth.
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