Overview

Learning topics

1 The purpose of accounting information

2 The regulation of accounting

3 Sustainability and sustainability standards

4 The main financial statements

5 Capital and revenue items

6 Qualitative characteristics of useful accounting information

7 Accounting concepts and conventions

8 Ethical considerations

Learning outcome

• Specify why an entity maintains financial records and prepares financial statement

• Specify the ethical and sustainability considerations for preparers of financial statement

• Record and account for transactions and events resulting in income, expenses, assets, liabilities and equity in accordance with the appropriate basis of accounting and the laws, regulations and accounting standards applicable to the financial statement

• Specify the key aspects of the accrual basis of accounting and the cash basis of accounting

Specific syllabus learning outcomes are: 1a, b, d; 3b

Syllabus links

The material in this chapter will be developed as you progress through the Accounting modules, and later in Professional Level Financial Accounting and Reporting.

Examination context

Questions on topics in this chapter will be knowledge-type multiple choice, multi-part multiple choice or multiple-response questions. In the exam you may be required to

• identify capital as opposed to revenue expenditure

• specify the distinctions between the different qualitative characteristics

• identify the principles that relate to each qualitative characteristic

• identify the different interests of stakeholders

• identify the differences between IFRS® Accounting Standards and UK GAAP