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Principles of Accounting


  • Credit value: 15 credits at Level 7
  • Convenor and tutor: Dr Lorenzo Neri
  • Assessment: a two-hour examination (100%)

Module description

This module consists of two parts. Part 1 covers the basic principles of financial reporting from which you will be introduced to the techniques of preparing and interpreting financial statements. Part 2 focuses on management accounting information and decision making. Together they provide a foundation in accounting on which you can further explore the world of accounting and finance.

Indicative syllabus

  • Introduction to financial accounting
  • Accounting concepts
  • Double-entry bookkeeping
  • Preparation of balance sheets and profit and loss accounts
  • Principal sources of finance for companies
  • Accounting ratios
  • Limitations of conventional financial statements
  • Costing for planning
  • Decision making and control
  • Accounting for materials
  • Labour and overheads
  • Absorption costing
  • Marginal costing and break even analysis
  • Budgetary control
  • Standard costing and variance analysis
  • Cash budgeting and management of working capital

Learning objectives

By the end of this module, you will be able to:

  • state the uses and users of accounting information
  • explain and apply accounting concepts, principles and conventions
  • analyse, interpret and communicate the information contained in basic financial statements, and explain the limitations of such statements
  • explain the role of management accounting within an organisation and the needs for management information
  • discuss the problems of traditional costing system
  • apply the marginal costing approach in decision making
  • examine the concept of relevant costing
  • develop budgets for management purposes.