FUNDAMENTALS OF ACCOUNTING

• What is Accounting, Book-Keeping, Transactions and an Account?
• Accounting Standards, Policies, concepts and equations
• Matching concepts in timing and operational control.
• Users and benefits of accounting information. • Hands on exercise on Accounting Equations.

EXPLANATION OF KEY ACCOUNTING TERMS IN:

• Statement of Income

- Revenue – in Accounting and Recognition criteria

- Other income

- Cost of Sales, Operating Expenses, Finance expenses

- Understand the difference between Revenue and Capital Expenditure

- Different classification of cost & Operating Expenses in Company Account Vs. Audited Financial Statement

- EBITDA – What is it and its calculation.

• Statement or Other Comprehensive Income (OCI)

- What are these and its importance of OCI.

• Statement of Financial Position

- Distinction with examples between:

o Non-Current, and Current Assets

- Explanation of different types of Non- Current and Current Assets:

o Property, Plant and Equipment Vs. Investment Assets

o Subsidiary and Association Companies Accounting treatment

o Difference between Trade and Other Receivables

o Financial Assets o Situation where Cash in Hand and at Bank will not tally to the closing Cash and Cash equivalent balance show in the Cash Flow Statement

o Biological Assets, Bearer Plant, Agriculture Produced.

o Right of Use Assets (RUA):

- Calculations

- Accounting double entries

- Salient points of Accounting Standards covering the RUA.

- Exemption of compliance

o Accounting for Hire Purchase, effective interest rate and interest amount calculations.

o Asset Depreciation, Amortization, Impairment, Fair Value and Appreciation Treatment.

o Deferred Tax Assets and Deferred Tax Liabilities

o Intangible Assets Explanation with examples of different types of Non-Current and Current Liabilities:

o Difference between Trade and Non- Trade Payables

- Equity:

o Treatment of Preference Shares – Liability or equity

• Explanation of what is Statement of Change in Equity

- Common components

- Meaning of Prior Adjustment and the word Restated.

• Statement of Cash flow

- Three main activities of cash flow and how are they derived, with examples

- Preparation methods

- How to read and understand Cash Flow Statement easily, on those prepared in an indirect method.

• Qualitative information:

- Chairman and Directors report

- Notes to the Accounts

- Understanding the different Audit opinions

DAILY TRANSACTIONS PROCESSING

• Transaction Processing Framework
• Transactional documentation processing for sales, purchase, sales and purchase returns.

- Timing and Documentations Matching Concept.

- What document to match?

- Checking and approving,

- Account coding, posting.

DOUBLE ENTRY ACCOUNTING SYSTEMS

• Concepts of double entry accounting system
• Chart of Accounts – Mother rule of all postings
• Various Books of Account – Gen. Ledger, Purchase Ledger, Sales Ledger, Journals, Cash books, Petty Cash Book, Fixed Assets Register, etc.
• Concepts of Accounting double entries for Assets, Liabilities, Revenue, Expenditure and Capital.
• Examples of various double entry transactions.
• Double entries for non-current assets disposals
• Double entries for selected SST transactions such as:

- Payback of sales tax exemptions given earlier

- Free goods and services

- Service tax for Imported taxable services

- Claiming service tax refund of digital tax incurred for resales.

- Bad debt relief and its subsequent recovery

- Upon deregistration of taxable service provider

• Double entries for selected E-Invoice transactions such as:

- Sales and Purchase of cash vouchers

- Self-billed issued when giving out of vouchers as commission

- Self-billed invoice received

- E-invoice issued on non-revenue items such as advance payment received, cash contribution for customers company function,

- Sales with payment by own outlet vouchers

- Sales with payment by third party vouchers

- Voucher expiry

- Top up corporate cards

- Consignment sales on: o Consignor o Consignee

- Others where participants may bring up.

• Double entries for Withholding tax:

- Absorbed by payee

- Absorbed by payer

- Paid by resident to foreign countries and claim tax credit from LHDN

- The 2% on commissions paid by local companies to individual tax residents.

• Dividend Declaration and Payment on different timing.
• Correction of errors
  

MONTH AND YEAR END CLOSING ADJUSTMENT REQUIREMENTS

• Journal Double entries for monthly adjustments such as prepayments adjustments, accruals and provisions for expenses, assets depreciation and amortizations.
• Amortization calculation for assets after revaluation.
• Journal Double entries for Provisions for bad and doubtful debts, provision (increase & decease) for stock obsolesces and provision for asset impairment.
• Treatment of non-payable expense provisions
• Closing Stocks Valuations from the monthly count.
• Cost of sales calculation

PREPARATION OF SUPPORTING SCHEDULES IN SUPPORTING OF FINANCIAL STATEMENT

• Supporting Schedules

- Assets and Liabilities

- Income and expenditures

• Reconciliations Statements

- Bank Reconciliation

- AR and AP

- Accruals and Prepayment.

BUDGETARY CONTROL / VARIANCE ANALYSIS

• Sales Variance analysis

- Price

- Volume o Value mixed, and

o Quantity mixed

• Operating expenses analysis
• Manufacturing material variance analysis

- Single Material

- Mixed Materials

- Material Yield

• Production Labour Variance analysis

- Hour usage

- Rate

- Idle time

• Overhead variance analysis

- Direct overhead

- Indirect overhead

• Variance analysis contribution to business performance.
• Factors that give rise to variances
• Accounting treatment on disposal of variances