FUNDAMENTALS OF
FINANCIAL ACCOUNTING
(FFA)
TEACHER : AAMIR SHAHZAD (ACMA)
INTRODUCTION:
AAMIR SHAHZAD (ACMA)
EDUCATION:
ELECTRICAL ENGINEERING (GIK Institute)
ASSOCIATE COST AND MANAGEMENT ACCOUNTANT (ACMA)
EXPERIENCE
1) CORPORATE EXPERIENCE:
Al-HILAL steel mills Islamabad ………….. 3 years
2) EXAM SUPERVISORERY EXPERIENCE
ICMAP Multan campus …………………… 2 years
3) TEACHING EXPERIENCE
a) COLLEGE OF CHARTERED ACCOUNTANCY (CA & ACCA) … 5 years
(Financial Accounting, Management accounting & Business Mathematics)
b) Alpha commerce academy …………………………………………… 3 years
Fundamentals of Financial Accounting
Lecture-wise Schedule
(90 CREDIT HOURS - 1.5 Hours per lecture)
LECTURES Topics to be covered
a) Financial Accounting definition & objectives,
b) Cost Accounting definition & Objectives
c) Management Accounting definition &
Lecture 1
Objectives
d) Difference between financial accounting and cost and management accounting
a)Explain the meaning and identify the examples of the following terms
(i)Capital Assets Liabilities
Lecture 2
(ii)Expenditures (Capital & Revenue) Revenue
PART A
a) Accounting Equation
Lecture 3 b) Understand and explain the accounting equation
a) Define Company Law
Lecture 4 b) Define types of companies as per Company Laws i.e., private and public limited, listed and non-
listed companies etc. Guarantee limited company, single Member Company
a) IAS, IFRS
b) Define IAS/ IFRS and its role
Lecture 5
c) Explain purpose of implementation company laws, IAS, IFRS in Financial reporting
Lecture 6 Accounting Concepts & Principles (Going Concern, Accruals, Prudence)
Accounting Concepts & Principles (Consistency, Materiality, Substance over form, Business Entity,
Lecture 7
Money Measurement)
Lecture 8 CLASS TEST 1
a) Identify various Source Documents (Sale & Purchase Or der, Credit & Debit Note, GRN) and explain
its purpose
Lecture 9 b) Books (Sale day book, Purchase day book, Sales Return day book, Purchase Return day book, Cash
book, Petty Cash book)
a) Principles of double entry bookkeeping
Lecture 10 b) Introduction of Journal
a)Practice of Principles of double entry bookkeeping
Lecture 11 b)practice of Journal entries
a) Posting from day book to nominal ledger and balance of ledger account
Lecture 12 b) Sales and Purchase accounts, including personal accounts and Control accounts
a) Practice of Posting from day book to nominal ledger and balance off ledger account &
Lecture 13 Sales and Purchase accounts, including personal accounts and Control accounts
a) Trial Balance
(i) Need and objective of trial balance
(ii) Preparing of trial balance
Lecture 14
(iii) Need and recording ofadjustments
(iv) Preparing of Adjusted trial balance
PRACTICE OF FOLLOWING :
(i) Need and objective of trial balance
(ii) Preparing of trial balance
Lecture 15
(iii) Need and recording ofadjustments
(iv) Preparing of Adjusted trial balance
a) Preparation of basic layout of financial statementS and Illustrate some example of financial
Lecture 16
statements - LECTURE 1
b) Preparation of basic layout off financial statement and Illustrate some example of financial
Lecture 17
statements - LECTURE 2
c) Preparation of basic layout off financial statement and Illustrate some example of financial
Lecture 18
statements - LECTURE 3
d) Preparation of basic layout off financial statement and Illustrate some example of financial
Lecture 19
statements - LECTURE 4
Lecture 20 CLASS TEST 2
a) Accruals and Prepayments
Lecture 21 (i) Prepare journal and adjusting entries of accruals and prepayments
b) Explain the matching concept with related to accruals and prepayments
Lecture 22 (i) How the amount of accruals and prepayments are depicted in financial statements?
a) Depreciation
(i) Purpose of charging depreciation
Lecture 23 (ii) Methods of calculating depreciation(Straight line, reducing balance and sum of year's digit) -
LECTURE 1
a) Depreciation
(i) Purpose of charging depreciation
Lecture 24
(ii) Methods of calculating depreciation(Straight line, reducing balance and sum of year's digit) -
LECTURE 2
a) Accounting treatment of the following:
(i) Re-valuation of non-current assets (Reversal of revaluation is excluded)
Lecture 25 (ii) Non-current asset disposal
(iii) Non-current asset register - LECTURE 1
a) Accounting treatment of the following:
(i) Re-valuation of non-current assets (Reversal of revaluation is excluded)
Lecture 26
(ii) Non-current asset disposal
(iii) Non-current asset register - LECTURE 2
a) Accounting treatment of Intangible Assets
b) Research and Development Cost
Lecture 27 c) Define research and development cost
d) Identify the treatment of research and development cost - LECTURE 1
a) Accounting treatment of Intangible Assets
b) Research and Development Cost
Lecture 28
c) Define research and development cost
d) Identify the treatment of research and development cost - LECTURE 2
a) Sales and Accounting Concepts
Lecture 29 b) Concept of debtor's age analysis
a) Bad and Doubtful Debts
(i) Nature and purpose of bad and doubtful debts
Lecture 30 (ii) General entries and aging analysis
b) Bad Debts Recovered
a) Categorization of liabilities (current and non-current liabilities)
Lecture 31 b) Cash and Credit Purchases
Lecture 32 a) Define, differentiate and classify Provisions, Contingent liabilities and Assets
a) Accounting for Inventories
(i) What is inventory or stock?
(ii) Its types; Raw Materials, Work in progress, Finished goods
Lecture 33
(iii) Valuation of inventory as per IAS 2
(iv) Lower of cost or NRV
Lecture 34
a) Valuation of Cost of sales and closing stock under FIFO, LIFO and AVCO (Both periodic and perpetual)
Lecture 35 CLASS TEST 3
a) Concept of Cash book, single column, double column and triple column cash book
b) Understanding of Bank statement and basic
Lecture 38 concepts
c) Reasons of differences between cash book balance and bank statement balance
a) Preparation of bank reconciliation statement
Lecture 39 b) Concept of which balance to be shown in statement of financial position -LECTURE 1
a) Preparation of bank reconciliation statement
Lecture 40
b) Concept of which balance to be shown in statement of financial position -LECTURE 2
a) ledger Accounts and the Division of the ledger Understanding of Control Accounts
Lecture 41 b) Use of Control Accounts
a) Purchase and Sale Day Books (Define and recording of transaction)
Lecture 42 b) Control Accounts Reconciliation
a) Types of Errors
b Suspense Accounts
Lecture 43
c) Correcting Entries
Lecture 44 CLASS TEST 4
a)Sole traders' accounts
(i) Chart of Accounts
Lecture 45
(ii) Preparation of Financial Statements
a)Company accounts
(i) Types of Limited Company
Lecture 46 (ii) Company Finance(Define concept)
(iii) Financial Statements
a) Issuance of Shares Reserves(Define the concept)
Lecture 47 b) Financial Statements of Companies
a)Manufacturing accounts
Lecture 48 (i) Preparation of Manufacturing Accounts - Lecture 1
a) Principles of Sales Tax (input tax, output tax and net tax)
Lecture 36 b) Bookkeeping Entries for Sales Tax
a) Accounting entries of Wages from the Employee's Viewpoint
b) The Wages Book
Lecture 37
c) Accounting for Payroll
a) Concept of Cash book, single column, double column and triple column cash book
b) Understanding of Bank statement and basic
Lecture 38 concepts
c) Reasons of differences between cash book balance and bank statement balance
a) Preparation of bank reconciliation statement
Lecture 39 b) Concept of which balance to be shown in statement of financial position -LECTURE 1
a) Preparation of bank reconciliation statement
Lecture 40
b) Concept of which balance to be shown in statement of financial position -LECTURE 2
a) ledger Accounts and the Division of the ledger Understanding of Control Accounts
Lecture 41 b) Use of Control Accounts
a) Purchase and Sale Day Books (Define and recording of transaction)
Lecture 42 b) Control Accounts Reconciliation
a) Types of Errors
b Suspense Accounts
Lecture 43
c) Correcting Entries
Lecture 44 CLASS TEST 4
a)Sole traders' accounts
(i) Chart of Accounts
Lecture 45
(ii) Preparation of Financial Statements
a)Company accounts
(i) Types of Limited Company
Lecture 46 (ii) Company Finance(Define concept)
(iii) Financial Statements
a) Issuance of Shares Reserves(Define the concept)
Lecture 47 b) Financial Statements of Companies
a)Manufacturing accounts
Lecture 48 (i) Preparation of Manufacturing Accounts - Lecture 1
a)Manufacturing accounts
Lecture 49
(i) Preparation of Manufacturing Accounts - Lecture 2
a) Incomplete records
(i) Incomplete Records: Basic Approach
Lecture 50
(ii) Cash and Bank Transactions
Lecture 51 a) Using Ratios and Percentages (Find out missing figures by using profit percentages)
a) Income and expenditure accounts
(i) Format of Income and Expenditure Accounts
Lecture 52
(ii) Preparation of Income and Expenditure Accounts
a) Statements of cash flows
(i) Format of a Statement of Cash Flows
Lecture 53
(ii) Preparation of a statement of Cash Flows by Direct method
a) Statements of cash flows
Lecture 54 (i) Format of a Statement of Cash Flows
(ii) Preparation of a statement of Cash Flows by IN-Direct method
Lecture 55 CLASS TEST 5
Lecture 56 a) Analysis of Accounting Statements and Use of Ratios
a) Liquidity, Working Capital and Solvency Ratios
(i) Financial Gearing
Lecture 57
(ii) Investor Ratios
Lecture 58 Revision Lecture 1 (CBE simulation)
Lecture 59 Comprehensive test 1
Lecture 60 Comprehensive test 2
BOOKS
1) ACCA F3
2) Financial and Managerial Accounting (Meigs & Meigs)
PATTERN & STRUCTURE OF QUESTION PAPER STUDY
SCHEME-2018
COMPUTER BASED EXAMINATIONS [CBE]
OPERATIONAL LEVEL-1 [OL1]
[O1] Fundamentals of Financial Accounting
Syllabus Composition of
30 – MCQs 20 of 02 mark each Marks = 60 Marks
02 Long questions (theoretical) of 5 marks each – 10 marks.
Numerical Assessment Questions (NAQs)
03 – NAQs of 10 Marks = 30
Total Marks = 100
Passing Marks = 50.
Lecture # 1:
Topics to cover:
1)Financial accounting (Definitions & objectives)
2)Cost Accounting (Definitions & objectives)
3)Difference between Financial, Cost and
Management Accounting
Financial Accounting:
Definition:
Financial accounting is the field of accounting concerned with
the recording, summarizing, analyzing and reporting of
financial transactions related to a business. This involves
the preparation of financial statements available for public
use.
Objectives of Financial Accounting:
The main purpose of financial accounting is to prepare
financial reports that provide information about a firm's
performance to external parties such as investors, creditors,
and tax authorities for decision making.
Cost Accounting:
Definition:
Cost accounting is a process of assigning costs to cost
objects that typically include a company's products,
services, and any other activities that involve the
company. Cost accounting is helpful because it can identify
where a company is spending its money, how much it earns,
and where money is being lost.
