43. Financial Statements (AAT)

The content of this particular qualification includes the following:

• 43.01. Purpose of financial statements: INTRODUCTION TO LIMITED COMPANIES, Private sector organisations, Sole traders, partnerships & limited companies, LIMITED COMPANIES, Objectives of companies, FINANCIAL STATEMENTS & THEIR PURPOSE, Financial statements, Objective of financial reporting, LIMITED COMPANY FINANCIAL STATEMENTS: INTERESTED PARTIES, Users of financial statements, Contents of the financial statements, Financial position, Financial performance, Changes in financial position, ELEMENTS OF FINANCIAL STATEMENTS, Importance of elements of financial statements, THE ACCOUNTING EQUATION, THE REGULATORY FRAMEWORK OF ACCOUNTING, Accounting standards, Purposes of accounting standards, Company Law, Conceptual Framework for Financial Reporting, CONCEPTUAL FRAMEWORK FOR FINANCIAL REPORTING, Users of financial information, The objective of financial reporting, Underlying assumptions, Qualitative characteristics of useful financial information, Relevance, Faithful representation, Enhancing qualitative characteristics, Materiality, The elements of financial statements, Financial position - the statement of financiial position, Financial performance - the statement of profit or loss, Recognition in financial statements, Measurement bases, ACCOUNTING CONCEPTS, Business entity, Materiality, Going concern, Accruals.
• 43.02. Introduction of limited company financial statements: ACCOUNTING TERMINOLOGY USED IN FINANCIAL STATEMENTS, Accounting terminology, ADVANTAGES OF FORMING A LIMITED COMPANY, Limited liability, Separate legal entity, Ability to raise finance, Membership, Other factors, THE COMPANIES ACTS, Public limited company (Plc), Private limited company (Ltd), Company limited by guarantee, GOVERNING DOCUMENTS OF COMPANIES, TYPES OF SHARES ISSUED BY LIMITED COMPANIES, Ordinary (equity) shares, Preference shares, Nominal & market values of shares, Issue price, LOANS & DEBENTURES, STATEMENT OF PROFIT OR LOSS & OTHER COMPREHENSIVE INCOME, STATEMENT OF FINANCIAL POSITION, RESERVES, Capital reserves, Revenue reserves, Reserves: profits not cash, STATEMENT OF PROFIT OR LOSS - TERMINOLOGY, EXAMPLE FINANCIAL STATEMENTS, Year dates, negative amounts, ACCESSIBILITY OF FINANCIAL STATEMENTS.
• 43.03. Published financial statements of limited companies: INTRODUCTION, DUTIES & RESPONSIBILITIES OF DIRECTORS, IAS 1 - PRESENTATION OF FINANCIAL STATEMENTS, Complete set of financial statements, Overall considerations, Structure & content - general principles, STATEMENT OF PROFIT OR LOSS & OTHER COMPREHENSIVE INCOME, STATEMENT OF CHANGES IN EQUITY, STATEMENT OF FINANCIAL POSITION, DEALING WITH DIVIDENDS IN THE FINANCIAL STATEMENTS, DIRECTORS' REPORT, STATEMENT OF CASH FLOWS, AUDITORS' REPORT, ACCOUNTING POLICIES, NOTES TO THE FINANCIAL STATEMENTS, BONUS ISSUES & RIGHTS ISSUES, Bonus issues, Rights issues, PREPARING FOR ASSESSMENT.
• 43.04. Accounting for assets: HOW TO STUDY ACCOUNTING STANDARDS, The international financial reporting standards, Organising your study of accounting standards, ACCOUNTING FOR ASSETS, IAS 16 - PROPERTY, PLANT & EQUIPMENT, Definitions, Recognition, Measurement of property, plant & equipment, Depreciation, Disclosure in the financial statements, IAS 38 - INTANGIBLE ASSETS, Definition, Recognition, Research & development, Measurement of intangible assets, IAS 36 - IMPAIRMENT OF ASSETS, Definitions, Scope of the standard, Indications of impairment, The impairment review, Recognition of impairment losses, Disclosure in the financial statements, IAS 17 - LEASES, Accounting for finance leases by lessees, Accounting for operating leases by lessees, IAS 2 - INVENTORIES, Inventory valuation methods, Net realisable value, Closing inventory valuation for a manufacturer.
• 43.05. Accounting for liabilities & the statement of profit or loss: ACCOUNTING FOR LIABILITIES, IAS 12 - INCOME TAXES, Current tax, Estimates of tax, LIABILITIES SIDE OF STATEMENT OF FINANCIAL POSITION, IAS 17 - LEASES, IAS 37 - Provisions, contingent liabilities & contingent assets, Provisions, Contingent liabilities, Contingent assets, Summary, IAS 10 - Events after the reporting period, STATEMENT OF PROFIT OR LOSS, IAS 16 - Property, plant & equipment, IAS 18 - Revenue.
• 43.06. Statement of cash flow: INTRODUCTION, FORMAT OF THE STATEMENT OF CASH FLOWS, Operating activities (indirect method), LAYOUT OF A STATEMENT OF CASH FLOWS, STATEMENT OF CASH FLOWS: INDIRECT METHOD, GAIN OR LOSS ON DISPOSAL OFNON-CURRENT ASSETS, Carrying amount & sale proceeds, Dealing with a gain or loss on disposal, Loss on disposal, Conclusion: Disposal of non-current assets, REVALUATION OF NON-CURRENT ASSETS, PREPARING FOR ASSESSMENT, STATEMENT OF CASH FLOWS: THE DIRECT METHOD, STATEMENT OF CASH FLOWS: DIRECT METHOD, LINKS TO THE STATEMENT OF FINANCIAL POSITION, Cash & cash equivalents, INTERPRETING THE STATEMENT OF CASH FLOWS.
• 43.07. Interpretation of financial statements: INTERESTED PARTIES, ACCOUNTING RATIOS & THE ELEMENTS OF FINANCIAL STATEMENTS, MAKING USE OF ACCOUNTING RATIOS, PROFITABILITY, Gross profit percentage, Expense/revenue percentage, Operating profit percentage, Return on capital employed (ROCE), Return on shareholders' funds, LIQUIDITY, Working capital, Current ratio (or working capital ratio), Acid test ratio (or quick ratio/liquid capital ratio), USE OF RESOURCES, Inventory holding period & inventory turnover, Trade receivables' collection period (days), Trade payables' payment period (days), Working capital cycle, Asset turnover ratio: non-current assets, net assets, FINANCIAL POSITION, Interest cover, Gearing, USE OF THE PRIMARY RATIO, Examples, INTERPRETATION OF FINANCIAL STATEMENTS, LIMITATIONS OF RATIO ANALYSIS, Retrospective nature of accounting ratios, Differences in accounting policies, Inflation, Reliance on standards, Other considerations, PREPARING FOR ASSESSMENT.
• 43.08. Consolidated financial statements: THE ACCOUNTING SYSTEMS OF AN ORGANISATION, INTRODUCTION TO CONSOLIDATED FINANCIAL STATEMENTS, PARENT & SUBSIDIARY COMPANIES DEFINED, CONSOLIDATION PROCEDURES, FAIR VALUES IN CONSOLIDATED FINANCIAL STATEMENTS, INTER-COMPANY ADJUSTMENTS, Receivables, payables & loans, Inter-company profits, PREPARING FOR ASSESSMENT, Summary, CONSOLIDATED STATEMENTS OF PROFIT OR LOSS, Notes on the statement of profit or loss, ASSOCIATE COMPANIES, Participating interest & significant influence, Equity method of accounting, DISCLOSURE IN CONSOLIDATED FINANCIAL STATEMENTS.

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