BOOKKEEPING FOUNDATIONS BBS103



Study Bookkeeping and start a new career!

Want the option of working full or part time?  A reasonable salary?  Skills that are constantly in demand?  Be able to work in any industry? As a book keeper you have choices.  Every business needs someone to look after their accounts, so the career possibilities are endless.

This course focuses on the nature of accounting for small business (mainly service firms), and will give you a very solid foundation in this discipline.

Bookkeeping Course

Gain valuable foundation knowledge in bookkeeping by Distance Learning.

  • Learn at home to keep financial records.
  • Manage your own business or start a small business as a bookkeeper.
  • Gain new skills and knowledge to improve your performance in your existing role in an administration or accounts department.

 

Study for an interesting, flexible career

Bookkeeping can provide you with an interesting, flexible and secure career. There are almost always jobs advertised for bookkeepers in every city. Bookkeeping may provide a pathway to extend your career into many other aspects of accounting, finance and business administration. The choice is yours.

Every business needs at least one person to do their accounts. Bookkeeping can provide a long and enjoyable career with options to branch out into other areas. This comprehensive course covers everything from keeping a ledger & cash control, to the balance sheet and profit and loss statements. It provides an extremely solid foundation and is suitable for:

  • Business owners
  • Administration or accounts employees
  • Anyone seeking a career as a bookkeeper 

Duration: 100 Hours (Nominal Duration).

 

COURSE STRUCTURE AND CONTENTS

 There are 13 lessons as follows:

Lesson 1. Introduction – Nature, Scope and Function of Bookkeeping

  • What is bookkeeping?
  • Difference between accountants and bookkeepers.
  • History of bookkeeping.
  • Bookkeeping terminology.
  • Understanding language.
  • Why do we need bookkeeping?
  • Bookkeeping as a management tool.
  • Business structures.
  • Financial information.
  • Accounting conventions and doctrines.
  • Accounting standards.
  • Australian accounting standards.
  • UK accounting standards.
  • International cooperation on standards.

Lesson 2. The Balance Sheet

  • What is a balance sheet?
  • Assets and liabilities.
  • Components of a balance sheet.
  • What items do not appear on the balance sheet.
  • Example of a Balance Sheet.
  • Tracking business performance.
  • T format balance sheet.
  • Balance sheet allocations.
  • What is working capital?

Lesson 3. Analysing and Designing Accounting Systems

  • What is an accounting system?
  • Understanding the flow of information in bookkeeping.
  • Other business documents - statements, order forms, quotations.
  • Steps in the bookkeeping process.
  • Designing the System.
  • Analysing business needs.
  • Designing the accounting system.
  • Designing the chart of accounts.
  • Writing a chart of accounts.
  • Designing the type of journals needed.

Lesson 4. The Double Entry Recording Process

  • Ledgers.
  • Opening up the general ledger.
  • Ledger accounts/ sub ledger.
  • The general ledger.
  • Entries resulting from transactions.
  • Recording transactions.
  • Different types of accounts.
  • A trial balance.
  • Ledger accounts and double entry bookkeeping.
  • Recording entries.
  • Rules to follow.
  • Analysis chart.
  • Footing ledger accounts.
  • Balancing ledger accounts.
  • The trial balance.
  • Accounting for drawings.
  • Revision of definitions and processes.

Lesson 5. The Cash Receipts and Cash Payments Journal

  • Recording cash transactions in journals.
  • Multi column receipts journal.
  • Cash payments journal
  • Multi column cash payment journal.
  • What discounts are allowed.
  • Accounting discounts allowed and received.

Lesson 6. The Credit Fees and Purchases Journal

  • Credit sales and credit purchases.
  • Credit sales journal.
  • Debtors subsidiary journal and control account.
  • Using a debtors schedule.
  • The credit purchases journal.
  • Creating a creditors subsidiary ledger and schedule.
  • The cash payments journal and creditors control account.

Lesson 7. The General Journal

  • Recording non standard transactions.
  • Designing the general journal.
  • Posting to a general journal.
  • General journal entries and ledgers.
  • Anomalies.
  • Recording credit purchases of non current assets.
  • Recording owners contributions or withdrawals.
  • Recording debts that are written off.
  • Recording contra entries.
  • Recording purchase returns.
  • Other uses for a journal.

Lesson 8. Closing the Ledger

  • Closing at the end of the accounting period.
  • Preparing for the new accounting period.
  • Transferring balance day closing entries.
  • Profit and loss account.
  • Determining gross profit.
  • Simple profit and loss account.
  • Balance sheet.
  • Businesses making a loss rather than profit.
  • Owner withdrawing revenue.
  • The end results.

Lesson 9. The Profit and Loss Statement

  • Introduction.
  • The balance sheet and how it relates to Profit and Loss Statement.
  • Using net profit figure to evaluate business performance.
  • What is profitability?
  • Gross Profit.
  • Net Profit.
  • Cash flow margin.
  • Return on assets margin.
  • Gearing ratio and how it relates to cash flow.
  • Return on owners equity margin.
  • Informative profit and loss presentation.
  • Segmentation.
  • Functional classification - grouping expenses.
  • Showing extraordinary expenses and revenue.
  • Accounting for unused materials or stock.
  • Why do we need to calculate the cost of materials used.

Lesson 10. Depreciation on Non-current Assets

  • Intangible assets.
  • Depreciation methods.
  • Depreciation calculation methods.
  • Calculating depreciation with the straight line method.
  • What if there is no residual value.
  • How to enter depreciation into the books.
  • Declining balance method of depreciation.
  • Calculating percentage rate of depreciation.
  • Production units method of depreciation.
  • What about intangible assets.
  • Keeping track of assets and depreciation.
  • Asset register.
  • End of Useful life for assets.
  • Loss disposal of asset account.

Lesson 11. Profit Determination and Balance Day Adjustments

  • Cash and accrual accounting.
  • Cash accounting.
  • Accruals accounting.
  • Balance day adjustments to final accounts.
  • How to record prepaid expenses.
  • Showing in the general ledger.
  • What about if we actually owe unpaid expenses on balance day?
  • Receiving income in advance.
  • Other balance day adjustments – stock, bad debts, depreciation, discounts.
  • A more comprehensive treatment of trial balance.
  • Partnerships.
  • Companies.
  • Clubs and non profit organisations.
  • Using a ten column worksheet or spreadsheet.

Lesson 12. Cash Control: Bank Reconciliation and Petty Cash

  • Ways of handling money.
  • Outgoing monies (payments).
  • Methods of controlling cash.
  • Recording cash transactions.
  • The cash book.
  • Bank transactions and the cash book.
  • Bank reconciliation statements.
  • The cash cycle – cash flow and liquidity.
  • Account receivable turnover ratio
  • Operating cash flow ratio.
  • Inventory turnover ratio.
  • Professional journals.

Lesson 13. Cash Control: Budgeting

  • Introduction.
  • Budget types.
  • The cash budget.
  • Factoring in safety margins.
  • Variable costs.
  • Budget reviews.
  • Taxes and budgets.
  • GST or VAT taxes.
  • Tax input credits.
  • Taxable supplies.

Each lesson culminates in an assignment which is submitted to the school, marked by the school's tutors and returned to you with any relevant suggestions, comments, and if necessary, extra reading.

Aims

  • Outline the uses of financial information; accounting standards and conventions and the basic functions of bookkeeping for service businesses.
  • Describe the use of balance sheets and their function.
  • Outline setting procedures for a bookkeeping system; steps in its use; the flow of information and use of other business documents.
  • Formulate procedures for the setting up of a double entry bookkeeping system
  • Outline the functions and specific uses of special journals.
  • Outline methods used to set up credit sales journal and credit purchases journals
  • Outline the setting up procedures for a general journal and its use
  • Describe methods used to close ledger accounts at the end of an accounting period.
  • Describe profit and loss statement preparation methods.
  • Outline the use of appropriate methods for the depreciation of non-current assets.
  • Outline the fundamentals of cash and accrual accounting; the matching process; the necessity for balance day adjustments.
  • Describe the cash cycle; the importance of cash control and its various methods including petty cash systems and bank reconciliation processes.
  • Outline the role of budgets and their importance to business.

 

What Does the Course Cover?

Here are just some of the things you will be doing:

  • Describe the activities of service businesses.
  • What is the difference between an accounting convention and a doctrine
  • How is the accounting period convention important to making business decisions?
  • Why might the accounting entity convention be important in business?
  • What is the Doctrine of Materiality?
  • Create a list of differences and a list of similarities between the goods and services tax system you investigated and Australia's system.
  • Define the term Balance Sheet Equation. Describe what a balance sheet is made up of. Know where items appear on the balance sheet. Describe 3 balance sheet formats.
  • Describe the meaning and importance of separating current assets from fixed current assets and current liabilities from long-term/deferred liabilities on the balance sheet.
  • Prepare a balance sheet.
  • Show the equations used for determining a businesses working capital.
  • Explain what the difference between a ledger and a journal.
  • Describe source documents.
  • Describe a chart of accounts and its use; draw up a chart of accounts.
  • List the journals used in an accounting system.
  • Describe a Statement of Account and outline its use.
  • Define double entry accounting.
  • Describe a ledger account and the difference between balancing a ledger account and footing a ledger account.
  • Define a trial balance; prepare a trial balance.
  • Compare three-column ledger accounts with T-form ledger accounts; enter transactions into a ledger account; balance a ledger account.
  • Describe the use of a drawing account, and how drawings are classified in the balance sheet
  • Describe the functions of an analysis chart include an example using transactions to show A, L and OE.
  • Prepare a T form Balance Sheet.
  • Describe a Cash Receipts and Cash Payments journal their uses and their source documents.
  • Differentiate between a general ledger and a special journal.
  • Outline the benefits of a multi-column cash journal and a simple format cash journal.
  • Design a cash payments journal and a cash receipts journal. Describe the functions of posting references and sundry columns. Post items to a cash receipts and cash payments journal.
  • Explain the difference between a discount allowed and a discount received
  • Describe the difference between a credit sale and a credit purchase and state the source documents. Prepare a credit fees/sales and a credit purchases journal and do a range of appropriate postings.
  • Describe the role and usefulness of a Subsidiary Ledger.
  • Outline the role and usefulness of a Debtors Control account.
  • Show the double entry of goods bought on credit.
  • Describe a Control Account
  • Describe the aim of a general journal and its key sections. Change a general journal to accommodate subsidiary ledger. Correct errors in a general ledger account.
  • Explain the term bad debt. Use the general journal to record a bad debt. Understand cents in the dollar; offer in relation to a bad debt. Write off bad debts. Prepare a general journal. Record entries to a general journal. Know how the general journal is used in preparing closing entries. Set up a general journal. Close off a general journal.
  • Explain the term and use of Contra Entries
  • Record non-current assets in a purchases journal
  • Know the difference between closing and balancing a general ledger account.
  • Identify which ledgers are closed off at the end of the accounting period.
  • Describe a profit and loss account and how to work out a net profit or a net loss. Know which account does the net profit or loss is transferred to.
  • Describe a profit and loss statement and how it relates to the balance sheet.
  • Know why functional classification and segmentation used on profit and loss reports
  • Describe extraordinary expenses and how they are listed on the profit and loss statement and why.
  • Describe Materials on Hand; calculate materials on hand. State how they are reported on the profit and loss statement. Prepare a profit and loss statement.
  • Describe the difference between cash accounting and accrual accounting.
  • Describe Balance Day Adjustments and their importance to bookkeeping.
  • Describe pre-paid expenses and outline the difference between the asset and expense approaches to the recording of prepaid expenses.
  • Describe the importance of reversing entries and when they are done.
  • Know a range of common balance day adjustments.
  • Prepare a Trail Balance for a business that carries stock and has balance day adjustments. Create general journal for adjusting entries; Post the entries to the relevant general ledger accounts.
  • Close off the accounts to profit and loss.
  • Prepare a new trial balance;
  • Prepare the profit and loss statement;
  • Prepare the balance sheet.
  • Enter reversing entries for the new accounting period.
  • Outline the usefulness of a 10 column worksheet.
  • Make entries into a cash book and present a reconciliation statement.
  • Draw up and use a petty cash book.
  • Describe bank reconciliation statements and their use.
  • Describe methods of cash control; describe liquidity and its link to cash flow.
  • Describe accounts receivable turnover ratio; operating cash flows ratio; Inventory turnover ratio.
  • Outline the importance of budgets to a business; describe a range of budgets.
  • Describe the term; safety margin;.
  • Describe the term cash budget, and outline how debtors and creditors are included.
  • Describe a range of variances in a budget.
  • Describe the importance of budget reviews.

    •  

    What Do Bookkeepers Do?

    Bookkeepers live in a world of finance. People working in the world of finance should understand terminology used by the bookkeeper, but sometimes others who you work for might not understand or appreciate the significance of the work a bookkeeper does.

    Bookkeepers need to communicate with both:

    1. People in the world of finance such as bankers, taxation officers, financial advisors; and

    2. People who are not in the world of finance, such as people who create and or provide goods and services to and from the enterprise they work for.

    A good bookkeeper needs to cultivate communication skills and be able to accurately interact with everyone they work with, in order to properly and accurately gather the information needed to do a good job.

    Understanding the Language

    Although accounting standards (and therefore terminology) may change from time to time, the concepts and language of bookkeeping has rigid consistency. It was formulated from a long history of accounting standards, set down by various bodies over many years - both as national and increasingly as international standards. Bookkeepers know the importance of learning the correct terms whilst also keeping pace with new standards as they are introduced. This is important knowledge that bookkeepers must learn and use to communicate with people in the world of bookkeeping and accounting.

     

    Terminology:

    Accounts receivable/debtors: the money owed to a business by a customer, after they have been sent an invoice, for the products or services they were supplied on credit.

    • Accounts payable/creditors: the money owed by the company for good or services supplied to them.
    • Accruals: bringing forward the cost of goods or services or the receipt of monies owed against an invoice into a current accounting period, even though you may not have paid for the goods/services received or received payment for goods/services you supplied.
    • Cash accounting: accounting system that does not recognise accruals – in other words it only recognises the debts and credits for a specified accounting period.
    • Assets: items of value to a person or a business that can be easily transferred to cash.
    • Current assets: Cash and other resources that a company expects to either use up or to turn into cash within the following year of the date on the balance sheet.
    • Fixed assets: an asset that is not sold off (or consumed) during the normal course of trading within a business.
    • Liabilities: the obligation of a business to transfer an item of value to another company or person. This can include accruals on a balance sheet.
    • Current liabilities: amounts due to be paid to creditors, within a twelve month period from the date on the balance sheet.
    • Capital: the assets and cash owned by a business.
    • Equity: the total value of assets within a business that have been contributed by the owner
    • Net profit: income generated before taxes.
    • Chart of accounts: a list of numbered and named ledger accounts.
    • Credit: a facility extended by a company or person to enable payment of goods after they are received.
    • Debits: an entry recorded on the left hand side of an account that shows an amount owed
    • Income accounts: the books in which all the income that is received by the business is recorded.
    • Journal: details all the financial transactions of a business and in which accounts these transactions belong.
    • General ledger: a book that specifies a summary of all the transactions held within the accounts of a business.
    • Trial Balance: a report that lists all the accounts of a ledger and the total (end amount for a given period) of the transactions for each account – both credits and debits.
    • Depreciation: due to wear and tear an asset is reduced in (book) value over a period of time.
    • Double entry bookkeeping: amounts are debited in one account and credited in another.

     

    Financial Statements:

    • Income statement: A financial statement that shows the results of all income received and expenditure by a business within a certain period.
    • Balance sheet: states the liability and assets held by a company at a particular date.
    • Profit and Loss Statement: a standard financial document for a specified period (e.g. monthly, 3 monthly or yearly) that summarizes a company's income and expenses.
    • Inventory: a list of stock (i.e. all items including raw materials and finished products etc.) held by a company.

    Using Bookkeeping as a Management Tool

    When a manager has access to well-kept books they can use these as a tool for future business planning and in order to make timely and considered decisions. They can see at a glance whether the business is making a profit or a loss, how much money is owed to creditors and how much is owed to the company by debtors. The can determine by using this information whether all is going to plan and decisions can then be made around that information. For example if sales are down should prices be dropped? Can the wage bill be met? Is downsizing an option to consider? Conversely, if sales are up decisions to expand the business may need consideration. How much would it cost to expand? How much extra money would it take to cover expansion costs? And so on.

    Managers are also able to see in detail where spending has increased or decreased. For example if the phone account is suddenly a lot higher than it has been in the past, employees may be using mobile phones more for business, or it may be for personal calls – these sorts of added, unexpected expenses, lower the net profit (or bottom line as it is referred to). A manager can look at these increases in expenditure and adjust spending or reign in employees accordingly.

    Cash flow is important in the secure trading of any business and efficient bookkeeping clearly shows the manager which creditors are slow in paying, and whether action needs to be taken.

    WHAT OPPORTUNITIES ARE THERE?

    There is, and always has been a strong demand for capable bookkeepers.

    To be a good bookkeeper, you need to not only have the skills, but also the right personality and mindset, to do the job. This is a job that requires a high level of focus on what you do, in order to achieve accuracy and acceptable speed.
    Some bookkeepers pass the exams, become qualified, but always struggle to maintain focus; while others love the job, and love working with figures, in a world of their own.


    Why Studying Bookkeeping With ACS?

    This course gives you all you really need to kick off a career in bookkeeping. If you are suited to this profession, you can build on your knowledge after this course by reading and experience; or through additional studies.

    The course can be started at any time, so you can enrol today!

    If you have any questions and want to know more about the course, please get in touch with us.

    Contact us by -

    Phone: (International) +44 ()) 1384 3442752, (UK) 01384 442752, or

    Email: [email protected], or 

    use our FREE COURSE COUNSELLING SERVICE to connect with our specialist tutors.