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Financial Accounting Skills

Office Administration · Level 6  ·  9 Chapters

Compiled by: Esther Mutahi

Can I download Financial Accounting Skills notes as a PDF?

Yes. The notes download as a PDF too: every chapter has a Download PDF button above its notes. Sign in and click it. Each download comes from your plan's monthly allowance or from credits. To read before you sign in, the first topic of every chapter opens to anyone, and a Profplanet plan opens the remaining topics.

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What Financial Accounting Skills covers

Financial Accounting Skills in Office Administration Level 6 teaches the bookkeeping cycle from the first source document to the sole trader's statements. It starts with accounting concepts, conventions and policies, the accounting equation and users of accounting information. Learners then prepare books of original entries, post transactions to the ledger, balance accounts and prepare a trial balance. Cash books, discounts, correcting errors with a suspense account and bank reconciliation statements come next. The unit also covers non-current assets and depreciation, receivables and payables ledgers with bad debts and control accounts, and sole trader income and financial position statements.

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Careers after Financial Accounting Skills

Accounts work runs through every office, and this unit prepares you to keep books that an owner or auditor can trust.

  • Accounts sections of county government offices - You record source documents in the books of original entry, post to ledgers, balance the accounts, and prepare trial balances.
  • Bookkeeping posts in small retail shops in Thika - You keep cash books, record cash discounts, and reconcile the cash book with the bank statement to find discrepancies.
  • Accounts clerk roles in schools and colleges - You maintain receivables and payables ledgers, adjust balances, make provisions and write off bad debts.
  • Asset and stores offices - You maintain the non-current assets register, compute depreciation, and record disposals.
  • Self-employed bookkeeping services - You prepare sole trader statements of profit or loss and statements of financial position for small clients, with year-end adjustments.

Correcting errors and adjusting for accruals and prepayments make your books reliable at year end.

Chapters

1
Apply accounting concepts, conventions and policies
7 topics
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2
Prepare books of original entries
12 topics
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3
Post transaction to the ledger
9 topics
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4
Prepare cash books
10 topics
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5
Correct accounting errors
6 topics
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6
Prepare Bank Reconciliation statements
6 topics
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7
Maintain non-current assets register
7 topics
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8
Maintain receivables and payables ledgers
7 topics
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9
Prepare sole trader statements
8 topics
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What Financial Accounting Skills covers: 46 main topics in 9 chapters

1. Apply accounting concepts, conventions and policies

  1. 1.1 Accounting concepts, conventions and policies
  2. 1.2 Accounting equation
  3. 1.3 Users of accounting information

2. Prepare books of original entries

  1. 2.1 Classification of transactions
  2. 2.2 Source documents
  3. 2.3 Books of original entry
  4. 2.4 Source documents recording

3. Post transaction to the ledger

  1. 3.1 Classification of ledgers
  2. 3.2 ledger accounts identification
  3. 3.3 Posting of transactions to ledgers
  4. 3.4 Balancing off ledger accounts
  5. 3.5 Trial Balance
  6. 3.6 Preparation of Trial Balance

4. Prepare cash books

  1. 4.1 Cash books
  2. 4.2 Classification of cash receipts
  3. 4.3 Recording of cash receipts
  4. 4.4 Discounts

5. Correct accounting errors

  1. 5.1 Errors affecting the trial balance
  2. 5.2 Errors that do not affect the trial balance
  3. 5.3 Correction of errors
  4. 5.4 Suspense account
  5. 5.5 Reported gross/net profit
  6. 5.6 The final statement of financial position

6. Prepare Bank Reconciliation statements

  1. 6.1 Cash book and bank statement balance discrepancies
  2. 6.2 Update the cash book
  3. 6.3 Bank reconciliation statement

7. Maintain non-current assets register

  1. 7.1 Determining costs of assets as per Accounting standards
  2. 7.2 Depreciation computation
  3. 7.3 Depreciation recording as per accounting guidelines
  4. 7.4 Accounting treatment on depreciation
  5. 7.5 Acquisition of Non-current assets
  6. 7.6 Disposal of non-current assets
  7. 7.7 Determining asset balances

8. Maintain receivables and payables ledgers

  1. 8.1 Bad debts written off
  2. 8.2 Provision for bad debts
  3. 8.3 Adjusting receivable balances
  4. 8.4 Adjusting Payable balances
  5. 8.5 Control accounts

9. Prepare sole trader statements

  1. 9.1 Income and expenditure
  2. 9.2 Year-end adjustments
  3. 9.3 Accruals
  4. 9.4 Prepayments
  5. 9.5 Provisions
  6. 9.6 Statement of profit or loss
  7. 9.7 Statement of financial position items
  8. 9.8 Statement of financial position

Revise this unit

Exam-style questions 126 Written to CDACC standard, with answers Test yourself 360 Multiple-choice, one at a time Practise questions 217 Quick recall — check you know the facts
3 more for this unit
Oral exam preparation 88 What the assessor asks, and how to answer out loud Worked calculations 65 Step-by-step maths with the common mistakes Quick cards 1,798 Myth busters, skill tips and scenarios

Beyond the syllabus

Decision simulator 9 On site, what would you do? Workplace scenarios 83 Real site situations — what would you do? Turn this into income 72 Where this skill earns — what to charge, how to find clients

Other units in Module V