Departments › Accountancy › Module I › Fundamentals Of Accounting

Fundamentals Of Accounting

Accountancy · Level 6  ·  7 Chapters

Can I download Fundamentals Of Accounting 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.

▣

What Fundamentals Of Accounting covers

Fundamentals of Accounting Level 6 takes an Accountancy learner from the accounting equation to full statements for sole traders, partnerships and companies. The first outcome covers the purpose of accounting, users of information, qualitative characteristics, concepts, conventions and accounting standards. You then apply double entry using source documents, books of original entry, the ledger, the trial balance and computerised accounting reports. Classification of capital and revenue items follows: bank reconciliation, accruals and prepayments, receivables and bad debts, depreciation of property, plant and equipment, inventory valuation and payables control accounts. You correct errors through the suspense account and a statement of corrected net profit, then prepare sole trader, partnership and company statements, including share capital, reserves, rights and bonus issues.

■

Careers after Fundamentals Of Accounting

Accounting is the backbone of every business and organization in Kenya, providing the essential information needed to make smart financial decisions. Mastering the fundamentals of accounting, especially following the International Financial Reporting Standards (IFRS), opens doors to a variety of rewarding career paths and entrepreneurial opportunities across the country.

  • In the vibrant Jua Kali sector, skilled accountants help artisans and small-scale manufacturers keep track of sales, expenses, and profits, ensuring their businesses grow sustainably.
  • County governments rely on accountants to manage public funds transparently and prepare reports that meet IFRS standards, playing a crucial role in local development projects.
  • Large corporations like KenGen and KTDA employ accountants to prepare accurate financial statements, aiding in investment decisions and regulatory compliance.
  • The bustling matatu industry needs accounting professionals to manage fleet expenses, revenue, and payroll, helping operators maximize profitability.
  • In agribusiness, accountants support farmers and cooperatives by managing financial records, budgeting, and accessing credit facilities.
  • On construction sites, accountants track project costs and payments, ensuring contractors and clients maintain financial discipline.
  • The hospitality sector benefits from accountants who manage daily transactions, payroll, and financial reporting, helping hotels and restaurants thrive.
  • Beyond employment, mastering IFRS-based accounting empowers you to start your own bookkeeping or consultancy service, serving small businesses or entrepreneurs who need expert financial guidance.

By mastering these accounting fundamentals, you position yourself as a trusted professional who can drive financial success and integrity in any Kenyan workplace. Your skills will not only earn you a stable income but also give you the confidence to build your own business and contribute meaningfully to Kenya’s economic growth. Keep learning—your future in accounting is bright and full of possibilities!

Chapters

1
Demonstrate understanding of accounting principle
8 topics
Open chapter →
2
Apply double entry concept
5 topics
Open chapter →
3
Classify capital asset and liability
10 topics
Open chapter →
4
Correct accounting errors and suspense accounts
5 topics
Open chapter →
5
Prepare a sole trader statement
4 topics
Open chapter →
6
Prepare partnership statement
7 topics
Open chapter →
7
Prepare company statement
8 topics
Open chapter →
What Fundamentals Of Accounting covers: 47 main topics in 7 chapters

1. Demonstrate understanding of accounting principle

  1. 1.1 Nature and purpose of accounting
  2. 1.2 Objectives of accounting
  3. 1.3 Limitations of financial accounting
  4. 1.4 Users of accounting information and their information needs
  5. 1.5 Qualitative characteristics of accounting information reports
  6. 1.6 Accounting concepts/principles and conventions
  7. 1.7 Accounting standards and their importance
  8. 1.8 The accounting equation

2. Apply double entry concept

  1. 2.1 Source documents
  2. 2.2 Books of original entry
  3. 2.3 The double entry system and the ledger
  4. 2.4 The trial balance
  5. 2.5 Computerised accounting systems reports

3. Classify capital asset and liability

  1. 3.1 Capital and revenue expenditure
  2. 3.2 Accounting for cash and cash equivalents, bank reconciliation
  3. 3.3 Accrued and prepaid expenses
  4. 3.4 Accrued and prepaid income
  5. 3.5 Accounting for accounts reports receivables, bad debts and allowance for doubtful
  6. 3.6 Debts
  7. 3.7 Property, plant and equipment depreciation, acquisition and disposal
  8. 3.8 Accounting for Inventories- valuation using specific cost
  9. 3.9 Methods
  10. 3.10 Accounting for accounts payable including control account

4. Correct accounting errors and suspense accounts

  1. 4.1 Meaning of terms
  2. 4.2 Types of errors
  3. 4.3 Functions of suspense account
  4. 4.4 Correction of errors using the suspense account reports
  5. 4.5 Statement of corrected net profit

5. Prepare a sole trader statement

  1. 5.1 Meaning of terms
  2. 5.2 Characteristics of a sole trader
  3. 5.3 Income statement
  4. 5.4 Statement of financial position reports

6. Prepare partnership statement

  1. 6.1 Introduction to partnership
  2. 6.2 Characteristics of partnership
  3. 6.3 Types of partners
  4. 6.4 Contents of a partnership agreement reports
  5. 6.5 Distinction between current and capital accounts
  6. 6.6 Appropriation statement and partners current and capital accounts
  7. 6.7 Statement of financial position and income statement (Excluding changes in partnerships)

7. Prepare company statement

  1. 7.1 Types of share capital
  2. 7.2 Types of reserves
  3. 7.3 Issue of shares (exclude issue by instalment and forfeiture)
  4. 7.4 Rights issues and bonus
  5. 7.5 Income tax -Accounting treatment reports and presentation (exclude computation)
  6. 7.6 Income statement
  7. 7.7 Statement of financial position
  8. 7.8 Emerging issues and trends

Revise this unit

Exam-style questions 98 Written to CDACC standard, with answers Test yourself 237 Multiple-choice, one at a time Practise questions 191 Quick recall — check you know the facts
3 more for this unit
Oral exam preparation 59 What the assessor asks, and how to answer out loud Worked calculations 35 Step-by-step maths with the common mistakes Quick cards 1,174 Myth busters, skill tips and scenarios

Beyond the syllabus

Decision simulator 6 On site, what would you do? Workplace scenarios 80 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 I