Introduction to Financial Accounting KASNEB Notes

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ATD LEVEL I

COURSE OUTLINE

GENERAL OBJECTIVE

This paper is intended to equip the candidate with knowledge, skills and attitudes that will enable him/her to account for various basic financial transactions and prepare financial statements.

LEARNING OUTCOMES

A candidate who passes this paper should be able to:

  • Apply accounting concepts in preparation of financial statements
  • Apply the double entry aspects of accounting
  • Account for assets and liabilities
  • Prepare financial statements of a sole trader, partnership and company.

CONTENT

Introduction to accounting

Nature and purpose of accounting

  • Objectives of accounting
  • Users of accounting information and their information needs
  • Qualities of useful accounting information
  • Accounting concepts/principles
  • Accounting standards and their importance
  • The accounting equation

Double entry bookkeeping and books of original entry including manual and computerised systems

  • Source documents
  • Books of original entry
  • The double entry system and the ledger
  • The trial balance and basic financial statements
  • Computerised accounting systems – Role of computers, application and accounting softwares in the accounting process, benefits and challenges of operating computerised accounting systems

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Accounting for assets and liabilities

  • Accrued expenses and prepaid expenses
  • Accounting for revenue including accrued income and prepaid income
  • Accounting for account receivables, bad debts and allowance for doubtful debts
  • Property   plant    and    equipment    including    capital    revenue    and    expenditure, depreciation, acquisition and disposal
  • Inventory – recognition, measurement and valuation using specific cost method (FIFO and weighted average cost only)
  • Accounting for cash and cash equivalents, bank reconciliation
  • Accounting for accounts payable including control account

Correction of accounting errors and the suspense account

Financial statements of a sole trader

  • Income statement
  • Statement of financial position

Partnership accounts

  • Contents of a partnership agreement
  • Distinction between current and capital accounts
  • Appropriation statement and partners current and capital accounts
  • Statement of financial position and income statement (excluding changes in partnerships)

Company accounts

Types of share capital – ordinary shares and preference shares

  • Types of reserves – share premium, revaluation reserve, general reserves and retained profits
  • Issue of shares (exclude issue by installment and forfeiture)
  • Rights issues and bonus
  • Income tax -Accounting treatment and presentation (exclude computation)
  • Income statement
  • Statement of financial position

Emerging issues and trends

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4 thoughts on “Introduction to Financial Accounting KASNEB Notes”

  1. It’s a good job done here.
    Kindly can I get the ATD notes for level I
    I’ll appreciate your response.

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