Premier Training

Understand the purpose and use of control accounts and journals (Press the ticks on the left to mark your understanding)

Explain the accounting principles of going concern, accruals, prudence and consistency
Explain the purpose of maintaining financial records for internal and external use
Describe the types of accounting records that a business should maintain and the main uses of each
Describe the main requirements of accounting standards (IFRS) in relation to inventory and non-current asset valuations
Explain the accounting characteristics of relevance, reliability, comparability, ease of understanding and materiality
Explain the differences between capital and revenue expenditure, classifying items as one or the other

Understand the principles of double entry bookkeeping

Explain the accounting equation

Define assets, liabilities and equity in an accounting context

Explain the purpose and use of books of prime entry and ledger accounts

Explain the purpose of reconciling the sales and purchases ledgers, and the cash book

Understand the accounting methods used to record non-current assets

Describe how the acquisition of non-current assets can be funded, including part exchange

Explain the accounting treatment for recording the acquisition and disposal of non-current assets

Explain the need for, and methods of, providing for depreciation on non-current assets

Describe the contents and use of the non-current assets register

Resolve any queries, unusual features or discrepancies relating to the accounting records for non-current assets or refer to an appropriate person

Account for the purchase of non-current assets

Calculate total capital expenditure including all associated costs

Record prior authority for the capital expenditure

Record in the appropriate accounts the acquisition of a non-current asset including funded by/part exchange

Record the acquisition in a non-current assets register

Close off or transfer the ledger account balances at the end of the financial period

Account for depreciation

Calculate the depreciation charges for a non-current asset using the:
* straight line method
* reducing balance method

Record the depreciation in the non-current assets register

Record depreciation in the appropriate ledger accounts

Close off the ledger accounts at the end of the financial period, correctly identifying any transfers to the statement of profit or loss

Account for the disposal of non-current assets

Identify the correct asset, removing it from the non-current assets register

Record the disposal of non-current assets in the appropriate accounts

Calculate any gain or loss arising from the disposal, closing off or transferring the account balance

Account for adjustments

Explain the accounting treatment of accruals and prepayments to expenses and revenue

Explain the reasons for, and method of, accounting for irrecoverable debts and allowances for doubtful debts

Record the journal entries for closing inventory

Record the journal entries for accrued and prepaid expenses and income

Record the journal entries for provision for depreciation, irrecoverable debts and allowances for doubtful debts

Record the journal entries to close off revenue accounts in preparation for the transfer of balances to the final accounts

Prepare and extend the trial balance

Prepare ledger account balances; reconciling them, identifying any discrepancies and taking appropriate action

Prepare a trial balance

Account for these adjustments:
* Closing inventory
* Accruals and prepayments to expenses and income
* Provisions for depreciation on non-current assets
* Irrecoverable debts
* Allowance for doubtful debts

Prepare the trial balance after adjustments

Check for errors and/or inaccuracies in the trial balance, taking appropriate action