Course Contents
Unit I: The Conceptual Foundation of Accounting 7 hours
Accounting as a language of business, forms of business organizations, types of activities performed by business organization; Users of accounting information: internal and external; Qualitative characteristics of accounting information; The accounting profession, role and activities of an accountant; The accounting framework - basic accounting assumptions, concepts, GAAP, definitions and terminology, Accounting information system in modern business organizations; Use of computers in accounting process.
Unit II: Basics of Corporate Reporting 5 hours
Legal requirements of accounting, provisions of Company Act relating to accounting, introduction to accounting standards (IFRS and NAS), annual report, major components, basic components of financial statements, basic financial statements: Income Statement, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement, Accounting Policies and Notes. Introduction to audit. Legal provisions regarding audit of accounts in Nepal.
Unit III: Processing and Recording Business Transactions 6 hours
The Basis for Recording Transactions: Sources of accounting information, External and internal events; Accounting transaction, the accounting equation and analysis of transactions, the role of source documents.
The Double Entry System: Debits and credits and its rules; The journals; T account; General ledger; Normal account balances; Objectives and preparation of trail balance; Use of excel in processing business transaction.
Unit IV: Accrual Accounting and Adjustments 12 hours
Adjusting Entries: The revenue recognition principle, matching principle; Cash verses accrual basis of accounting, The need for adjusting entries; Types of adjusting entries; Journalizing adjusting entries; Effects of failing to prepare adjusting entries, Preparation of adjusted trial balance.
Worksheet and Accounting Cycle: Preparation of ten and twelve column work-sheet; Preparing financial statements from the work sheet The closing process; Post-closing trail balance; Completion of accounting cycle.
Unit V: Preparation of Financial Statements 12 hours
Income Statement: Concepts and major components; revenues, cost of goods sold, gross profit, net income and retained earnings; statement of retained earnings, preparation of income statement with vertical multi-step format.
Balance Sheet: Concepts and major components; assets, liabilities and stockholders' equity; preparation of balance sheet under vertical- classified format; use of computers in preparation of income statement and balance sheet.
Cash Flow Statements: Cash flows and accrual accounting; purpose of the statement of cash flows; financing, investing and operating activities; formats of statement of cash flows; preparation of cash flow statement using direct method, Reconciling cash flow under operating activity using indirect method, use of computers in preparation of cash flow statement.
Unit VI: Accounting for Cash and Cash Equivalents 6 hours
Components of cash and cash equivalents; preparation of the bank reconciliation statement and the need for adjustments to accounting records; petty cash, balance sheet presentation of cash and cash equivalent, Internal control system; Cash control: receipt and disbursement.
