FINANCIAL ACCOUNTING
AIMS AND OBJECTIVES
The examination in this subject sets out to assess candidates’:
(i) Understanding of accounting principles and the role of accounting in recording business
transactions;
(ii) appreciation and application of the rules and functions of Accounting as they apply to organization;
(iii) foundation for further studies in Accounting.
EXAMINATION SCHEME
There will be two papers – Paper 1 and Paper 2, both of which will constitute a composite paper to be
taken at one
sitting.
PAPER 1: Will comprise fifty multiple choice questions to be taken in 1 hour for 50 marks.
PAPER 2: Will be made up of two sections: Sections A and B and will last 2½ hours.
Section A:
Will contain five essay questions on theory of financial accounting. Candidates will
be required to answer two out of the four questions for 15 marks each.
Section B:
Will contain five essay questions on financial accounting practice. Candidates will be required
to answer three out of the questions for 15 marks each.
DETAILED SYLLABUS
S/NO
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TOPICS
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NOTES
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1.
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Introduction to Financial
Accounting
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1.1 History, nature and functions of Accounting.
1.2 Users of Accounting information.
1.3 Stages in the Accounting process.
1.4 Characteristics of Accounting information.
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2.
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The Accounting Equation
and Double Entry
Principles
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2.1 Accounting Equation.
2.2 Purpose
and functions of source documents.
2.3 Subsidiary books.
2.4 The ledger: classification of Accounts.
2.5 Cash Book:
analytical cash book,
including petty cash book.
2.6 Preparation of Trial Balance.
2.7 Bank Reconciliation Statements.
2.8
Correction of errors and Suspense Account.
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3.
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Accounting Concepts
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3.1 Meaning.
3.2 Types.
3.3 Significance.
3.4 Limitations.
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4.
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The Final Accounts of a
Sole Trader/proprietorship
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4.1 Trading, profit and loss
accounts/Income statement.
4.2 Balance sheet/statement of
financial position.
4.3 Adjustments to final
accounts.
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5.
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Provisions and Reserves
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5.1 Provision for doubtful
debts/Allowance for doubtful debts.
5.2 Provision for discounts.
5.3 Depreciation – concepts,
reasons for recording and methods: (i) straight line;
(ii) reducing balance;
(iii) sum of the years digits;
(iv) revaluation.
5.4 Accounting for
depreciation.
5.5 Reserves – revenue and
capital reserves.
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6.
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Manufacturing Accounts
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6.1 Purpose of Manufacturing
Accounts.
6.2 Cost classification in
Manufacturing Accounts.
6.3 Preparation of final
Accounts of Manufacturing concern.
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7.
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Control Accounts and Self-
balancing Ledgers
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7.1 Meaning and uses of
control accounts
7.2 Types:
(i) sales ledger control
(ii) purchases ledger control
7.3 Preparation of Control
Accounts
7.4 Reconciliation of Control
Accounts
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8.
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Single Entry and Incomplete
Records
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8.1 Meaning and limitations
8.2 Computation of profit or
loss from opening and closing balance sheets.
8.3 Conversion of singe entry
to double entry.
8.4 Preparation of final
accounts from a set of incomplete records.
8.5 Mark up and Margin
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9.
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Accounts of Not-for-Profit
Making Organizations
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9.1 Meaning and terminologies.
9.2 Receipts and payments
accounts.
9.3 Subscriptions Account
9.4. Income and expenditure
accounts.
9.5 Accumulated fund.
9.6 Balance sheet.
9.7 Profit or loss from income
generating activities.
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10.
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Partnership Accounts
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10.1 Nature and formation of
partnership.
10.2 Partnership
agreements/Deed.
10.3 Profit and loss
appropriation accounts.
10.4 Partners capital account
and balance sheet
10.5 Admission of a new
partner.
10.6 Treatment of goodwill and
revaluation of assets
10.7 Dissolution of
partnership (Questions will not be set on Garner V. Murray and piecemeal
realization)
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11.
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Company Accounts
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11.1 Nature and formation of a
company.
11.2 Types of companies and
shares.
11.3 Issue of shares.
11.4 Loan capital,
debentures/loan notes and mortgages.
11.5 Final accounts of company
for internal use only.
11.6 Interpretation of
accounts using simple ratios.
11.7 Purchase of business
account.
*11.8 Statement of Cash Flow
(using direct and indirect methods).
NOTE: Separate questions may
be set to meet statutory requirements of individual countries. Candidates’
answers must meet statutory requirements of individual countries.
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12. *
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Accounting for Value
Added Tax
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12.1 Purpose of VAT.
12.2 Characteristics of VAT.
12.3 Bases of computing
input/output VAT.
12.4 Preparation of VAT
returns.
12.5 Exempt goods and
services.
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13.
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Departmental and Branch
Accounts
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13.1 Meaning and importance
13.2 Differences between a
department and branch.
13.3 Preparation of
departmental account.
13.4 Preparation of Branch
Account excluding foreign branches.
13.5 Inter branch
transactions.
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14.
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Public Sector Accounting
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14.1 Meaning and difference
between Public Sector and Private
Sector Accounts.
14.2 Sources of public
revenue.
14.3 Capital and recurrent expenditures.
14.4 Preparation of simple
government accounts.
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15. *
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Information Technology in
Accounting
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15.1 Manual and computerized
Accounting Processing Systems.
15.2 Processes involved in
data processing.
15.3 Computer Hardware and
Software.
15.4 Merits and demerits of
manual and computerized accounting processing systems.
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16**
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Miscellaneous Accounts
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16.1 Meaning, introduction, terminologies
and preparation of
simple:
(i) Joint Venture Accounts
(ii) Consignment Accounts
(iii) Contract Accounts
(iv) Hire Purchase Accounts
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17.**
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Financial system
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17.1 Meaning and components.
17.2 Meaning, functions and
features of:
(i) money market;
(ii) capital market;
(iii) insurance market.
17.3 Methods of raising funds
from the capital market:
(i) offer for sale;
(ii) offer for subscription;
(iii) rights issue;
(iv) private placement;
17.4 Requirements for accessing the capital
market.
17.5 Benefits of capital
market to:
(i) investors;
(ii) government;
(iii) economy;
(iv) individual company;
17.6 Types, features and
reasons for regulation.
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NOTE: * Available to candidates in Ghana only
**
Available to candidates in Nigeria, The Gambia, Sierra Leone and Liberia only
RECOMMENDED TEXT BOOKS
1. Business Accounting volume 1 - West African Edition by Frank Wood and
Omunya.
2. Business Accounting Volume 2 - Frank Wood.
3. Accounting and Finance - Frank Wood.
4. Foundation Accounting - A. H. Millchamp.
5. Basic Accounting - J. D. Magee.
6. Accounting for Senior Secondary School
-
S. C. Malhorta, P. K. Botchweyand, P. A.
Amankwah.
7. Accounting in Business - R. J. Bull.
8. Company Accounts - J. N. Amorin.
9. Principles of Accounting - K. B. Appiah Mensah
10. Incorporated private Partnership Act 1962, Act 152.
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