BY H O ONDIGO UNIVERSITY OF NAIROBI SCHOOL OF BUSINESS JAN 2013 DAC 202 : ACCOUNTING FOR EQUITIES.

BYH O ONDIGO

UNIVERSITY OF NAIROBISCHOOL OF BUSINESS

JAN 2013

DAC 202 : ACCOUNTING FOR EQUITIES

COURSE OUTLINE

• COURSE TITLE: ACCOUNTING FOR EQUITIES.

COURSE CODE: DAC 202•COURRSE PRE-REQUISITE : DAC

102•LECTURERS: HERICK ONDIGO •SEMESTER: JAN-APRIL 2013

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COURSE OBJECTIVE:

• This is an intermediate course in accounting intended to enable the students to appreciate the theory, practice and proficiency in the accounting treatment of equities and liabilities (the claims of the owners and creditors against the assets of the entity) the course covers the measurement and reporting of income, liabilities and stockholders equity.

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COURSE CONDUCT

• Lectures will be the main mode of instruction. Students may also be required to make group or individual presentations on assigned topics or cases to test the understanding of the learner on presentation and analytical skills. It is recommended for the learner to read and appreciate the core issues relevant in the topics before the lecture sessions.

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COURSE EVALUATION

• The course will be evaluated as follows:• Homework Assignments and readings or

presentations 10%• Continuous Assessment Tests 20%• FINAL Examination 70%• Total Maximum Possible

100%• Minimum Pass Mark Required 40%

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COURSE TEXT

• Kieso E D, J J Weygand & T D Warfield., Intermediate Accounting-IFRS EDITION, 14th edition, John Wiley & Sons Publishers , 2011

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OTHER READING MATERIALS

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•IASB., International Financial Reporting Standards (IFRS’s) & International accounting Standards (IAS’s) •Smith J.M & F Skousen, Intermediate Accounting, 11th edition South-Western Publishing Company•Spicelend J.D, J.F Sepe and L.A Tomassini: Intermediate Accounting, 4th Edition MacGraw Hill , 2007

TOPICS1:INTRODUCTION

An over-view of the conceptual framework underlying financial accounting and financial reporting & the accounting cycle.

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2. MEASUREMENT AND PRESENTATION OF INCOME

• The uses and limitations of an income statement.

• Quality of income• Single-step income statement.• Multiple-step income statement.•

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2. MEASUREMENT AND PRESENTATION OF INCOME CONT…

• Reporting of irregular items.• Discontinued operations.• Exceptional items.• Unusual gains and losses.• Changes in accounting principle.• Changes in estimates.• Corrections of errors.• Intra-period tax allocation.• Reporting of earnings per share information• Preparation of a statement of retained earnings.• Other comprehensive income

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3. DILUTIVE SECURITIES AND EARNINGS PER SHARE

• The issuance, conversion, and retirement of convertible securities.

• Accounting for convertible preferred stock.• Accounting for stock warrants and for stock

warrants issued with other securities.• Accounting for stock compensation plans under

generally accepted accounting principles.• The controversy involving stock compensation

plans.• Computation of earnings per share in a simple

capital structure.• Computation of earnings per share in a complex

capital structure. 1-11

4. ACCOUNTING FOR SHAREHOLDER’S EQUITY – CONTRIBUTED CAPITAL

• Characteristics of the corporate form of organization.

• Key components of stockholders’ equity.• Accounting procedures for issuing shares

of stock.• Accounting for treasury stock.• Accounting for and reporting of preferred

stock.•

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4. ACCOUNTING FOR SHAREHOLDER’S EQUITY – CONTRIBUTED CAPITAL CONT

• Policies used in distributing dividends.• Various forms of dividend

distributions.• Accounting for small and large stock

dividends, and for stock splits.• Presentation and analysis of

stockholders’ equity.

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5. ACCOUNTING FOR CURRENT LIABILITIES AND CONTINGENCIES

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• Nature, type, and valuation of current liabilities.

• Classification issues of short-term debt expected to be refinanced.

• Types of employee-related liabilities.• The criteria used to account for and

disclose gain and loss contingencies.• The accounting for different types of loss

contingencies.• Presentation and analysis liabilities and

contingencies.

6. ACCOUNTING FOR LONG TERM DEBT

– The formal procedures associated with issuing long-term debt.

– Various types of bond issues.– The accounting valuation for bonds at date of

issuance.– Methods of bond discount and premium

amortization.– Accounting for the extinguishment of debt.– Accounting for long-term notes payable.– The reporting of off-balance-sheet financing

arrangements.– Presentation and analysis long-term debt. 1-15

7. ACCOUNTING FOR LEASES BY LESSEES

• The nature, economic substance, and advantages of lease transactions.

• The accounting criteria and procedures for capitalizing leases by the lessee.

• The operating and capitalization methods of recording leases.

• Special features of lease arrangements that cause unique accounting problems.

• The effect of residual values, guaranteed and unguaranteed, on lease accounting.

• the disclosure requirements for leases 1-16

THE END OF COURSE

•BEST OF LUCK IN THE COURSE

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