Detailed Course Outline

 

Section 1:  Learning outcomes

First section is designed to let the candidate understand the very basics of accountancy. This will help to brush up their fundamentals of accounts and business terms.

By the completion of the first module students should be able to:

  1. Understanding various legal form of business. Understanding deeds, agreements and memorandum with which Proprietorship, Partnership, Joint stock companies, and Joint ventures come in existence and the impact on accounting.
  2. Describe the foundations of accounting and the role accounting standards play in the accounting environment
  3. Explain, analyze and apply transactions to the accounting equation
  4. Prepare general journal entries, post to the general ledger
  5. Prepare cash and credit journals, post to general ledger and extract trial balance
  6. Prepare and reconcile subsidiary ledgers
  7. Prepare journal entries and ledger postings for special transactions
  8. Construct a set of accounts to trial balance
  9. Identify the types of errors and their effect upon trial balance, profit figures and balance sheet values, and correct errors.
  10. Maintain management controls over cash
  11. Prepare entries for depreciation and disposal of non-current assets for an accounting period
  12. Match expenses and incomes to the accounting period
  13. Construct suitably classified statements incorporating the matching concept and accrual concept including closing and reporting overview
  14. 14.     Explain the relationships among the income statement, balance sheet, statement of cash flows, and statement of owners’ equity

Section 2: Learning outcomes

Second section will let the candidate understand the accounting from reporting and analytical point of view. How information is disclosed keeping GAAP’s in consideration and how accounting policy may affect financial statements. Also they will be able to critically evaluate the financial statements based on common ratios and other tools.

By the completion of second module students should be able to:

  1. Discuss the roles of financial reporting and financial statement analysis
  2. Discuss the role of key financial statements (income statement, balance sheet, statement of cash flows, and statement of changes in owners’ equity) in evaluating a company’s performance and financial position with special reference to Schedule VI of Indian Companies Act 1956
  3. Discuss the importance of financial statement notes and supplementary information, including disclosures of accounting methods, estimates, and assumptions, and management’s discussion and analysis
  4. Discuss the importance of Cash flow statements and Fund flow statements and their linking with each account in financial statements.
  5. Ratios
  1. Evaluate and compare companies using ratio analysis, common-size financial statements,
  2. Describe the limitations of ratio analysis;
  3. Calculate, classify, and interpret activity, liquidity, solvency, profitability, and valuation ratios;
  4. Demonstrate how ratios are related and how to evaluate a company using a combination of different ratios;
  5. Demonstrate the application of and interpret changes in the component parts of the DuPont analysis (the decomposition of return on equity);
  6. Accounting in computerized environment and importance of internal control. Bird eye view of different accounting software and  ERP packages e.g. TALLY , SAP etc
  7. Understanding basic cost concepts, Cost volume profit analysis, Marginal costing for decision making under various alternatives;
  8. Cost allocation, absorption and Activity based costing and activity based management
  9. Standard costing and Variance analysis for control and review
  1. Discuss the objective of audits of financial statements, the types of audit reports, and the importance of effective internal controls with special reference to  Sarbanes-Oxley Act Audit, SAS 70 audit for Service organizations and System audits

Section 3: Learning Outcomes

This section gives the candidate the practical aspects of working in various process of finance and accounting.

After completion of the module the candidate will be able to

  1. Explain the role of standard-setting bodies, such as the International Accounting Standards Board and the U.S. Financial Accounting Standards Board, and regulatory authorities such as the International Organization of Securities Commissions, the U.K. Financial Services Authority, and the U.S. Securities and Exchange Commission in establishing and enforcing financial reporting standards;
  2. Compare and contrast key concepts of financial reporting standards under IFRS and alternative reporting systems, and discuss the implications for financial analysis of differing financial reporting systems
  3. Explain the general principles of revenue recognition and accrual accounting, demonstrate specific revenue recognition applications (including accounting for long-term contracts, installment sales, barter transactions, and gross and net reporting of revenue), and discuss the implications of revenue recognition principles for financial analysis
  4. Discuss the general principles of expense recognition, such as the matching principle, specific expense recognition applications (including depreciation of long-term assets and inventory methods), and the implications of expense recognition principles for financial analysis
  5. Demonstrate the appropriate method of depreciating long-term assets, accounting for inventory, or amortizing intangibles, based on facts that might influence the decision
  6. Understand special type of transactions and their effects on financial statements according to  US GAAP
    1. Change in accounting policies and subsequent events
    2. Contingent liabilities and commitments
    3. Discontinued operations
    4. Earnings per share
    5. Related party transactions
    6. Segment Reporting
    7. Intangible assets
    8. Research and development cost
    9. Contract accounting
    10. Interim financial reporting
    11. Extra ordinary items
  7. Long Lived Assets
    1. Explain the accounting standards related to the capitalization of expenditures as part of long-lived assets, including interest costs
    2. Compute and describe the effects of capitalizing versus expensing on net income, shareholders’ equity, cash flow from operations, and financial ratios, including the effect on the interest coverage ratio of capitalizing interest costs;
    3. Identify the different depreciation methods for long-lived tangible assets, and discuss how the choice of method, useful lives, and salvage values affect a company’s financial statements, ratios, and taxes;
    4. Discuss the use of fixed asset disclosures to compare companies’ average age of depreciable assets and calculate, using such disclosures, the average age and average depreciable life of fixed assets;
    5. Describe amortization of intangible assets with finite useful lives and the estimates that affect the amortization calculations;
    6. Discuss the liability for closure, removal, and environmental effects of long-lived operating assets, and discuss the financial statement impact and ratio effects of that liability;
    7. Discuss the impact of sales or exchanges of long-lived assets on financial statements;
    8. Define impairment of long-lived tangible and intangible assets and explain what effect such impairment has on a company’s financial statements and ratios;
    9. Calculate and describe both the initial and long-lived effects of asset revaluations on financial ratios.
  8. Deferred Tax Assets and Liabilities
    1. Explain the differences between accounting profit and taxable income, and define key terms, including deferred tax assets, deferred tax liabilities, valuation allowance, taxes payable, and income tax expense;
    2.  Explain how deferred tax liabilities and assets are created and the factors that determine how a company’s deferred tax liabilities and assets should be treated for the purposes of financial analysis;
    3.  Determine the tax base of a company’s assets and liabilities;
    4. Calculate income tax expense, income taxes payable, deferred tax assets, and deferred tax liabilities, and calculate and interpret the adjustment to the financial statements related to a change in the income tax rate
  9. Leasing vs. Buying
    1.  Discuss the motivations for leasing assets instead of purchasing them and the incentives for reporting the leases as operating leases rather than finance leases;
    2. Determine the effects of finance and operating leases on the financial statements and ratios of the lessees and lessor
    3.  Distinguish between a sales-type lease and a direct financing lease, and determine the effects on the financial statements and ratios of the lessor
  10. Cash Management models
  11. Account receivables Management
  12. Account payables Management
  13. Accounting for Mergers, demergers  and Amalgamation AS 14
  14. Accounting for Holding and Subsidiary company AS 21, consolidated financial statements, Minority Interest, Inter company holdings.
  15. Accounting for foreign  currency exchange transactions under Indian accounting standard AS 11 and US Financial account standard FAS 52

Accounting for financial derivatives FAS 133.  Accounting treatment of different margins charged by exchange, Impact of derivative contracts on closing of financial statements

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