Aim
In this unit learners will prepare financial statements for different types of business, complying with relevant legal and regulatory provisions and the basic principles of group accounts. Learners will also develop tools for the interpretation of financial statements.
Unit abstract
It is essential for the success of any business that it has good financial control and record keeping. Lack of effective control, planning and recording can ultimately lead to poor financial results. Owners and managers need to be able to recognise the indications of potential difficulties and take remedial action when required.
The unit considers the current regulations governing financial reporting, the formats of financial statements and the purpose of these statements for different users.
Learners will use records to complete financial statements. They will consider various categories of business income and expenditure and use cash flow forecasts, monitoring and adjusting for the effective management of cash flow. They will measure financial performance using a profit and loss account and balance sheet and analyse the profitability, liquidity and efficiency of a business through the application of ratio analysis.
Learning outcomes
On successful completion of this unit a learner will:
- Understand the regulatory framework for financial reporting
- Be able to prepare financial statements from complete or incomplete records
- Be able to present financial information in accepted formats for publication
- Be able to interpret financial statements.
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