Unit 1: Theoretical Framework
Introduction to Accounting
Accounting: objectives, advantages and limitations, types of accounting information; users of accounting information and their needs.
Basic accounting terms: business transaction, account, capital, drawings, liability (Non - current and current); asset (Non - current; tangible and intangible assets and current assets), receipts (capital and revenue), expenditure (capital, revenue and deferred), expense, income, profits, gains and losses, purchases, purchases returns, sales, sales returns, stock, trade receivables (debtors and bills receivable), trade payables (creditors and bills payable), goods, cost, vouchers, discount - trade and cash.
Theory Base of Accounting
- Fundamental accounting assumptions: going concern, consistency and accrual.
- Accounting principles: accounting entity, money measurement, accounting period, full disclosure, materiality, prudence, cost concept, matching concept and dual aspect.
- Accounting Standards and IFRS (International Financial Reporting Standards): concept and objectives.
- Double entry system of accounting.
- Bases of accounting - cash basis and accrual basis.
