An Introduction to Internal Auditing in Banking . 17 Unit 5. <...> Why do you need the accounting information? 2. <...> General definition of accounting Today, it is impossible to manage a business operation without accurate and timely accounting information. <...> Managers and employees, lenders, suppliers, stockholders, and government agencies all rely on the information contained in two financial statements. <...> These two reports — the balance sheet and the income statement – are summaries of a firm's activities during a specific time period. <...> They represent the results of perhaps tens of thousands of transactions that have occurred during the accounting period. <...> Accounting is the process of systematically collecting, analyzing and reporting financial information. <...> The basic product that an accounting firm sells is information needed for the clients. <...> The firm's accounting system provides the information dealing with revenues, costs, accounts receivables, amounts borrowed and owed, profits, return on investment, and the like. <...> This information can be compiled for the entire firm; for each product; for each sales territory, store, or individual salesperson; for each division or department; and generally in any way that will help those who manage the organization. <...> Accounting information helps managers plan and set goals, organize, motivate, and control. <...> Stockholders and potential investors need the information to evaluate soundness of investments, and government agencies need it to confirm tax liabilities, confirm payroll deductions, and approve new issues of stocks and bonds. <...> The firm's accounting system must be able to provide all this information, in the required form. 2. <...> The basis for the accounting process The basis for the accounting process is the accounting equation. <...> It shows the relationship among the firm's assets, liabilities, and owner's equity. <...> Assets are the items of value that a firm owns — cash, inventories, land, equipment, buildings, patents, and the like. <...> Liabilities are the firm's debts and obligations — what it owes to others. 4 Owner's equity is the difference between a firm's assets and its liabilities — what would be left over for the firm's owners if its assets were used to pay off its liabilities. <...> The relationship among these three terms is the following: Owners' equity = assets — liabilities (The owners' equity is equal to the assets minus the liabilities). <...> For a sole proprietorship or partnership, the owners' equity is shown as the difference <...>
Accounting_and_auditing_.pdf
МИНИСТЕРСТВО ОБРАЗОВАНИЯ И НАУКИ РФ
ФЕДЕРАЛЬНОЕ ГОСУДАРСТВЕННОЕ
БЮДЖЕТНОЕ ОБРАЗОВАТЕЛЬНОЕ УЧРЕЖДЕНИЕ
ВЫСШЕГО ПРОФЕССИОНАЛЬНОГО ОБРАЗОВАНИЯ
«ВОРОНЕЖСКИЙ ГОСУДАРСТВЕННЫЙ
УНИВЕРСИТЕТ»
ACCOUNTING AND AUDITING
Учебно-методическое пособие
Составитель
Е.В. Ушакова
Воронеж
Издательский Дом ВГУ
2014
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Содержание
Unit 1. Accounting ................................................................................................ 4
Unit 2. Foreign trade ............................................................................................. 8
Unit 3. Project finance ......................................................................................... 12
Unit 4. An Introduction to Internal Auditing in Banking ................................... 17
Unit 5. Fraud ....................................................................................................... 20
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COMPREHENSION
I. Answer the questions
1. What is accounting? Give a short definition.
2. Is it possible to manage a business operation without accurate and timely accounting
information?
3. Who needs accounting information? Explain why.
1. What is the basis for accounting process?
2. State the standard form of the accounting equation.
3. What is a balance sheet? Give a short definition.
4. What must a balance sheet show?
5. What is an income statement?
9. What can be computed from the information contained in a balance sheet and
an income statement?
10. Do the ratios computed from this information provide a picture of a firm's
profitability and its financial position?
11. Is this information for competitors?
LANGUAGE PRACTICE
1. Insert the necessary word or word combination.
2. Managers, lenders, suppliers and government agencies relay on the information
contained in two ....
3. These two reports — the balance sheet and ... —are summaries of a firm's activities
during a specific time period.
4. The basis for the accounting process is ... .
5. Assets are the ... that a firm owns.
6. Liabilities are the firm's debts and ....
7. Owners' equity is the difference between a firm's ... and its liabilities.
8. A balance sheet is ... of a firm's assets, liabilities, and owners' equity accounts
at a particular time.
9. A balance sheet must demonstrate that the accounting ... does indeed balance.
10. An income statement is a summary of a firm's revenues and... during a specific
accounting period.
11. The information in these two financial statements becomes more important
when it is ... with corresponding information for previous years or past ... periods.
2. Match the word with the right definition.
1. accounting
2. revenue
3. asset
4. stockholder
5. balance sheet
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a) the activity of keeping detailed record of the amounts of money a business
receives and spends.
b) a written statement of the amount of money and property a company has.
c) the things the company own.
d) a person who owns shares in a company.
e) money that a company receives from people.
3. Refer the sentences into English
1. Бухгалтерский учет — это процесс систематического сбора и сообщения
финансовой информации.
2. Балансовый отчет и отчет о доходах являются основой процесса бухучета.
3.
Балансовый отчет (или отчет о финансовом положении)- это обобщенный
отчет об активах фирмы, пассивах и собственном акционерном капитале.
4. Отчет о доходах — это обобщенный отчет о доходах и расходах за (during)
конкретный отчетный период.
5. Основой процесса бухгалтерского учета является бухучетное уравнение.
6. Согласно (according to) бухучетному уравнению, активы равны пассивам
(денежным обязательствам) плюс собственный акционерный капитал.
7. Собственный акционерный капитал — это разность между активами и
пассивами.
8. Балансовый отчет должен показывать, что бухучетное уравнение балансируется.
9.
Результаты (results) балансового отчета должны сравниваться (be compared)
с результатами за (for) прошлый отчетный период.
10. Эта информация дает картину доходности фирмы, ее финансового положения
и ее деятельности в области (area) дебиторской задолженности, товарных
запасов и долгового финансирования.
FOLLOW UP
1. Speak about the role of accounting in business.
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UNIT 2. Foreign trade
LEAD IN
1. Discuss these questions.
1. What are some of the risks involved in trading internationally?
2. What payment methods do you know that are used when exporting or importing
goods?
3. What is the role of the banks in international trade?
Open Account
The goods, and relevant documents, are sent by the exporter directly to the
overseas buyer, who will have agreed to remit payment of the invoice back to the
exporter upon arrival of the documents or within a certain period after the invoice
date. The exporter loses all control of the goods, trusting that 5 payments will be
made by the importer in accordance with the original sales contract.
Documentary Credit
Documentary Credit is often referred to as a Letter of Credit. This is an undertaking
issued by an overseas bank to a UK exporter through a bank in the UK,
to pay for the goods provided that the exporter complies fully with the conditions
established by the Documentary Credit.
Additional security can be obtained by obtaining the 'confirmation' of a UK
bank to the transaction, thereby transferring the responsibility from the importer's
bank overseas to a more familiar bank in the country of the exporter.
Very few risks arise for the exporter because the potential problem areas of
the buyer risk and country risk can be eliminated. However, the exporter must
present the correct documents and comply fully with the terms and conditions of the
credit. Failure to do so could result in the exporter losing the protection of the credit.
Bills for Collection
Trade collections are initiated when an exporter draws a bill of exchange
on an overseas buyer. This is forwarded by the exporter's bank in the importer's
country.
Such collections may be either “documentary” or “clean”. A documentary
collection is one in which the commercial documents and, if appropriate, the documents
of title to the goods are enclosed with the bill of exchange. These are sent by
the exporter's bank to a bank in the importer's country together with instructions to
release the documentation against either payment or acceptance of the bill.
The risks that the exporter has to face are that the importer fails to accept
the bill of exchange or dishonours an accepted bill upon maturity. This means
that the exporter may have to consider shipping the goods back to the UK, finding
an alternative buyer or even abandoning the consignment, all of which could
be expensive.
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