Fundamentals of Accounting Part 1 (Based on CMO3 S2007 Revised Syllabus)

Important:  As part of my research re accounting topics... found out that there's a revised syllabus on Fundamentals of Accounting-Part 1 which should be taught to BSA students beginning SY2007 and onwards (or until further issuance of new CMO) ... 

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                                                     Republic of the Philippines

OFFICE OF THE PRESIDENT

COMMISSION ON HIGHER EDUCATION

CHED MEMORANDUM ORDER (CMO)

No. 3

Series 2007

Below is an excerpt from ANNEX A – SUGGESTED DESCRIPTIONS, COURSE OUTLINES, AND REFERENCES of CMO No. 3 Series 2007 pertaining to the Syllabus of Fundamentals of Accounting, Part 1.

Course Title        :               Fundamentals of Accounting, Part I

Credit                    :               Six (6) units

Prerequisite        :               (None)

Course Description:

This course provides and introduction to accounting, within the context of business and business decisions.  Students obtain basic understanding of the principles and concepts of accounting as well as their applicability and relevance in the national context and learn how to use various types of accounting information found in financial statements and annual reports.  Emphasis is placed on understanding the reasons underlying basic accounting concepts and providing students with an adequate background on the recording, classification, and summarization functions of accounting to enable them to appreciate the varied uses of accounting data.

Course Outline:

1.       Introduction to Accounting

1.1          Definition, purpose, nature, functions, scope and objectives of accounting

1.2          Different branches of accounting ( financial, managerial, etc)

1.3          The classical notion of stewardship

1.4          Users of accounting information (internal vs external users)

1.5          Double entry bookkeeping

1.6          History of accounting

1.6.1           The Florentine vs the Venetian approach to reporting

1.6.2           Savory and the Napoleonic Commercial Code

1.6.3           The industrial revolution and the share-issuing company

1.6.4           The arrival of income taxation and the conflict with financial accounting

1.6.5           Schmalenbach and the charts of accounts

1.6.6           The rise of the group of companies and the need for consolidated accounts

1.6.7           Internalization of markets and reporting

1.7          Accounting variations among countries

1.7.1     Why practices differ from one country to another even though the same set of basic principles is followed

1.7.2      The linkage of tax laws and accounting principles requirements for enterprises in certain countries

1.7.3           Differences in the degree of development of the capital markets in countries and their effect on the development and use of generally accepted international principles of accounting

1.8          Basic Professional values and ethics

1.8.1           Reputation

1.8.2           Integrity and due care

1.8.3           Competence

1.8.4           Objectivity

1.8.5           Client relations and confidentiality

1.8.6           Reporting breaches of conduct

1.8.7           Unlawful activities

1.8.8           Fees and remuneration

1.8.9           Publicity and advertising

1.8.10       Disciplinary procedures

1.9          Forms of business organization and their activities (e.g. financing, investing and operating)

1.10      Accounting concepts and principles

1.11      The basic financial statements of business organizations

1.12      Relationships among the financial statements

1.13    Definition, classification and examples of assets, liabilities, capital or owner’s equity, income, and expenses.

1.14      The accounting profession: career opportunities

1.15  Specialized accounting fields (public accounting, private accounting, government accounting, accounting education)

2.       Introduction to Accounting Information System

2.1          Features of an effective information system

2.2          Overview of an accounting information system

2.3     The three stages of data processing :  A comparison of computerized and manual accounting system

3.       Analyzing and summarizing business transactions

3.1          Definitions of business transactions and source documents

3.2          Summary of business activities (financing, investing, operating)

3.3          The accounting equation

3.4          Analyzing and accounting for business transactions

3.5      Presentation of results of routine transactions by preparing the Basic Income Statement, Owner’s Equity Statement, Balance Sheet, and Statement of Cash Flows

4.       Recording transactions of a service company (Sole Proprietorship)

4.1      Double-entry accounting and accounting systems:  Florentine vs Venetian approach to reporting, Savory and Napoleonic Commercial code, and Schmalenback

4.2          The account and T-account

4.3          Rules of debit and credit

4.4          Chart of accounts and normal balances of an account

4.5      Recording in two-column journal (initial investment by owner, changes in assets, liabilities and capital, changes in income and expenses, withdrawals of owners)

4.6          Posting to the ledger

4.7          Preparing the trial balance

5.       Measuring business income

5.1          Accrual-basis accounting vs Cash-basis accounting

5.2          Accounting period

5.3          Revenue principle

5.4          Matching principle

5.5          Time period concept

5.6          Overview of the adjusting process

5.7          Adjustments for prepayments (deferrals), accruals, uncollectible accounts receivable, depreciation of property, plant and equipment

5.8          Preparation of the adjusted trial balance and financial statements

5.9          Use of accounting information for decision making  

6.       Completing the accounting cycle

6.1          Overview of the accounting cycle               

6.2          Preparing an accounting worksheet

6.3          Using the worksheet

6.4     Preparing financial statements form the worksheet (income statement, owner’s equity statement, balance sheet, cash flow statement (simple cash receipts and disbursements statement)

6.5          Journalizing and posting adjusting entries

6.6          Journalizing and posting closing entries

6.7          Preparing the post-closing trial balance

6.8          Preparing the reversing entries

7.       Recording merchandising business transactions

7.1    Merchandising operations (nature and operating cycle of a merchandising business, business documents)

7.2      Recording merchandising business transactions in a two-column general journal (sales revenue, sales returns and allowances, sales discounts, purchases of merchandise, purchase returns and allowances, purchase discounts, transportation costs)

7.3          Inventory systems (perpetual and periodic inventory procedures)

7.4          Determination of merchandise inventory, costs of goods sold and gross margin

7.5          Worksheet preparation

7.6          Adjusting and closing process for a merchandising business

7.7          Financial statements of a merchandising business

7.8          Use of accounting information in decision making  

8.       Recording transactions in special journals

8.1          Nature and use of control accounts and subsidiary ledgers

8.2   Types of Special Journals (sales journal, purchases journal, cash receipts journal, cash disbursements journal)

8.3      Recording of financing, investing and operating transactions in the special journals and general journal

   

9.       Manufacturing operations

9.1          Nature of manufacturing business

9.2          Transactions related to the manufacturing process

9.3          Elements of manufacturing costs

9.4         Preparation of financial statements of a manufacturing enterprise (balance sheet, income statement, statement of cost of goods manufactured and sold)