Accounting
The Impact Of Globalization On Accounting Education
There are several definitions of accounting.
The world of accounting follows certain guidelines and procedures that compose of acceptable accounting practice at a given time. The basics of accounting principles are as follows.
This accounting principle states that all relevant information which would affect the understanding and evaluation or assessment of the user of the accounting entity should be disclosed in the financial statements.
Consistency Principle.
Objectivity Principle.
Revenue Recognition Principle.
Accounting 101
As a result, it is important to educate the accounting field on the standards of other countries. The future will also hold the mandatory adoption of International Financial Reporting Standards (IFRS) in the U.S. which will change reporting from rules-based US GAAP to principles-based IFRS standards.
Failure to prepare will increasingly lead to accounting opportunities being given to foreign, English-speaking accountants and firms who are trained and experienced with international standards. It is important to consider the question of how accounting education should change. Accounting education at the high school, college, CPA and professional levels will all have to be modified in accordance to IFRS. Should both accounting standards be taught in the future? In the subject of accounting, these textbook companies should pave the way and require the authors to slowly relate GAAP to IFRS standards, in order to slowly introduce it. A gradual transition will not require additional class time by accounting majors thus keeping the field attractive to students. Keeping the accounting field adaptable and employable may prevent outsourcing, prevent rising unemployment rates for the accounting profession, and will make business transactions between the US and other countries easier. Accounting Today: Technology. 4 March 2010. 20 March 2010.
“IFRS Transition Issues.” 20 March 2010. gx/en/ifrs-reporting/ifrs-publications.jhtml#IFRStransitionissues>.
Financial Executive. education-training/continuing-education/11416715-1.html>.
Accounting Today: News.
The value of managerial accounting in the workplace
Accounting has been called as the language of business. Accounting is the system which measures business activities. It processes activities in business into reports and communicates the results to top management.
Ancient Accounting
Pacioli is considered as the father of accounting.
Information Age
Evolution of Accounting
Managerial accounting is concerned with the use of economic and financial information to plan and control many activities of an entity and to support the management decision course. Management accountants play important roles more specifically in planning ; coordination with production, marketing and financial functions. A subset of the managerial accounting profession is cost accounting which relates to the determination and accumulation of products, processes, or service costs.
The internal orientation that management accountants have to their companies differs from the predominantly external orientation of financial accounting. Financial accounting is more externally important to such people as investors and shareholders. Management accountants work hand and hand with other internal departments such as merchandising, accounting, marketing, web and more.
In order to become a managerial accounting professional a bachelor’s degree with a major in accounting is usually a requirement. A management accountant may also become a Certified Management Accountant (CMA) by passing a respective board four-part test.
The American Institute of Certified Public Accountants (AICPA) states that management accounting as practice extends to three areas: strategic management, performance management and risk management. Strategic Management is advancing the role of the management accountant as a strategic partner in the organization.
The future possibilities for managerial accountants are endless.
Accounting Students – five Simple and easy Lessons for Success in the Fall Campus Recruiting Season
This summary takes the form of an account known as receipts and payments account.
(i) Cash book for recording receipts and payments, and
Receipts and payments account
It is a summary of cash book for a given period, but the Receipts and Payments account shows the totals of cash transactions under different heads. All the receipts, be cheque or cash are entered on the debit (receipts) side (as in cash book) whereas all the payments (both by cheque or cash) are shown on the credit (payments) side. It is a summary of cash book, like a cash book, receipts are shown on the debit side and payments on the credit side.
Cash and bank items are merged in one column. Just like cash book, it starts with the opening balance of cash and bank and closes with the closing balance of cash and bank.
Both revenue and capital receipts and payments are recorded in this account. For example, this account ignores: !
Limitations of receipts and payments account
Receipts and payments account suffers from following limitations :
Income and expenditure account
This account serves exactly the purpose which ‘profit and loss account’ serves in a trading concern. On the pattern of ‘profit and loss account’ income is shown on the credit side and expenditure on the debit side.
Balance Sheet
Liabilities on left hand side and assets on right hand side. The capital fund is built up out of surplus from income and expenditure account.
Distinction between “receipts and payments account” and “Income and expenditure account” :
Receipts and Payments Account
Debit side is for receipts and credit side is for payments.
Closing balance represents cash in hand and at bank.
It ignores outstanding items.
It ignores non-cash items like depreciation, bad debts etc.
Income and Expenditure Account
It is a nominal account.
It is like a profit ; loss account.
Closing balance is merged into capital fund.
Debit side is for expenses and credit side for incomes.
Closing balance represents either surplus or deficiency.
It may show a debit or credit balance.
It records outstanding items.
It records non-cash items like depreciation, bad debts etc.
Peculiar items of non-trading concern’s
It appears on the receipts side of receipts and payments account. It should not be considered as income but should be treated as capital receipt i.e. credited to capital fund account.
It appears on the receipts side of the receipts and payments account and is, usually, credited to income. Life membership fees
Sale proceeds should be treated as income, and therefore, to be credited to income and expenditure account.
As discussed above, these should be credited to special fund all expenses related to such fund are shown by way of deduction from the respective fund and not as expenditure in income and expenditure account.
Sale of old asset
It cannot be taken to income and expenditure account. Profit or loss in such a case is taken to income and expenditure account. It is worthy to note that such donations should not be treated as income because if they are taken to income and expenditure account, it will increase income. The increased income may be utilized for any other purpose. General donations
Endowment fund
Amount in the income side of institutions. Amount collected from such shows by sale of tickets is an income of institution and shown in the income side of income and expenditure account.
Accumulated (Capital) Fund
It is increased (or decreased) by any surplus (or deficit) on the Income and Expenditure account.
Non Profit Organization Accounting