ACCOUNTING AND FINANCIAL STATEMENTS REVISION. ACC--- 1.How many of you will work as acc one day? 2.How many of you are acc majors? 3.Which acc magazines.

ACCOUNTING AND FINANCIAL

STATEMENTSREVISION

ACC---

1. How many of you will work as acc one day?

2. How many of you are acc majors?

3. Which acc magazines do acc majors need to read to stay informed?

4. How much power do acc have in formulating acc policies?

5. Have you ever opened a bank acc?

ACC---

6. Is acc an exact science?

7. Who writes the details of financial transactions in acc: bookeeppers or acc?

8. Who usually approves the acc at the end of the acc year?

9. How much acc knowledge do managers need to understand company acc?

10.Who completes the draft acc for the acc year?

QUIZ

WHAT DO BOOKKEEPERS DO?

a) E_____r data and r_____d transactions in journals (ledgers) of companies accounts

b) T____n data into meaningful financial information, prepare financial s________s

c) Are in c______e of internal and ex_____al oversight of accounts

WHAT DO BOOKKEEPERS DO?

a) Enter data and record transactions in journals (ledgers) of companies accounts

b) Turn data into meaningful financial information, prepare financial statements

c) Are in charge of internal and external oversight of accounts

WHAT DO ACCOUNTANTS DO?

a) enter data and record transactions in j_____s (l______s) of companies accounts

b) turn data into m__________l financial information, prepare financial statements

c) are in charge of internal and external o_______t of accounts

WHAT DO ACCOUNTANTS DO?

a) enter data and record transactions in journals (ledgers) of companies accounts

b) turn data into meaningful financial information, prepare financial statements

c) are in charge of internal and external oversight of accounts

WHAT DO AUDITORS DO?

a) E____r d____a and r_____d tr_____s in j_______s (l______s) of com____es ac_______s

b) are in c______e of i_____l and e______l o______t of acc____s

c) turn d_____a into m_________l fin____ial i_______n, p______e fi_______l st_________s

WHAT DO AUDITORS DO?

a) enter data and record transactions in journals (ledgers) of companies accounts

b) are in charge of internal and external oversight of accounts

c) turn data into meaningful financial information, prepare financial statements

THE THREE FINANCIAL

STATEMENTS

WHICH ARE THE THREE FINANCIAL STATEMENTS?

a) The p_____it and l_____s account, the i____me statement and the c____h flow statement

b) The p_____it and l_____s account, the balance s_____t and the c_______h flow statement

c) The i______me statement, the b_____ce s_____t and the annual report

WHICH ARE THE THREE FINANCIAL STATEMENTS?

a) The profit and loss account, the income statement and the cash flow statement

b) The profit and loss account, the balance sheet and the cash flow statement

c) The income statement, the balance shaeet and the liquidity statement

WHAT DOES THE PROFIT AND LOSS ACCOUNT SHOW?

a) It shows revenue/turnover - costs/overheads

b) It shows assets, liabilities and owners’ equity

c) It shows sources of funds and applications of funds

WHAT DOES THE BALANCE SHEET SHOW?

a)It shows assets (what the company owes), liabilities (what the company owns) and shareholders' equity

b)It shows a company’s ownership structure through equity

c)It shows assets (what the company owns), liabilities (what the company owes) and shareholders' equity

WHAT DOES THE CASH FLOW STATEMENT SHOW?

a) a company’s profitability

b) cash inputs and cash outputs

c) cash inflows and cash outflows

WHAT IS MISSING?

P&L

Revenues T________ LINE- C______ of sales= GROSS PROFIT - Operating expenses= EBITDA– Depreciation and a___________

= EBIT

- Interest - Taxes______ = NET PROFIT B________ LINE

BALANCE SHEET

ASSETS (to own)

C__________ ASSETS

FIXED ASSETS

OTHER ASSETS: GOODWILL

LIABILITIES (to owe)

CURRENT LIABILITIES

L________ LIABILITIES

OWNER’S EQUITY

SHARE CAPITAL

R_________ PROFIT

RESERVES

ASSETS

FIXED

PROPERTY

P__________

EQUIPMENT

LAND

CURRENT

CASH

DEBTORS (ACCOUNTS R__________)

INVENTORY

INTANGIBLE

BRAND NAMESC__________PATENTSTRADE MARKS

LIABILITIES

CURRENT

ACCOUNTS PAYABLEA_________ EXPENSES

LONG TERM

DEFERRED INCOME TAX

LONG-TERM DEBT (M_________, BONDS)

CASH FLOW STATEMENT

money coming into the business (inflows)

money going out of the business (o_______)

OPERATING/ I___________/FINANCING ACTIVITIES

COPY THE OPPOSITES

Current

Revenue

Credit

Profit

Assets

Net

Accounts receivable

Liabilities

Debit

Gross

Accounts payable

Expenditure

Long-term

Loss

DEFINITIONS

depreciationinterestliabilitiesloansharesbalance sheet

assetsinstallmentsacquisitioncapitalauditbudget

1. buildings, machinery, money in the bank and

money owed by customers

2. the loss of value of tangible assets

3. money which is borrowed

4. the extra money paid when borrowing money

5. all financial resources available for use

6. the obligation which legally binds an entity to

settle a debt

7. the parts of a listed company you can buy

8. paying small amounts over a period of time

9. the purchase of another company

10.an official examination of the accounts

11.a financial plan for the year

12.a statement of the company’s financial position

WRITING TASK

Formal letter (e-mail)

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