Introduction to Financial Accounting

N4
 Module 1 – Accounting theory, principles and
concepts
THE CONCEPT OF ACCOUNTANCY
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 1 – Accounting theory, principles and concepts (continued)

CAPITAL FOR A NEW BUSINESS

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 1 – Accounting theory, principles and concepts (continued)

THE PROFIT MOTIVE

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 2 – Forms of ownership

DIFFERENT FORMS OF OWNERSHIP

The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 2 – Forms of ownership (continued)

FORMS OF OWNERSHIP
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 3 – Documents and authorisation of
transactions
SOURCE DOCUMENTS
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 3 – Documents and authorisation of transactions (continued)

INTERNAL DOCUMENTS
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 3 – Documents and authorisation of transactions (continued)

EXTERNAL DOCUMENTS
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 3 – Documents and authorisation of transactions (continued)

FILING/ARCHIVING OF DOCUMENTS
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 3 – Documents and authorisation of transactions (continued)

REGISTERS OF UNUSED DOCUMENTS

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 3 – Documents and authorisation of transactions (continued)

SAFEKEEPING OF USED AND UNUSED INTERNAL SOURCE

DOCUMENTS
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 3 – Documents and authorisation of transactions (continued)

AUTHORISATION OF TRANSACTIONS
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 3 – Documents and authorisation of transactions (continued)

SOURCE AND SUPPORTING DOCUMENTS

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 4 – Starting a commercial enterprise

ACCOUNTING SYSTEMS USED BY THE BUSINESS

The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 4 – Starting a commercial enterprise (continued)

BANKING AND BANKING ACCOUNTS

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 4 – Starting a commercial enterprise (continued)

GUIDELINES FOR RECEIVING AND DEPOSTING MONEY

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 4 – Starting a commercial enterprise (continued)

GUIDELINES FOR PAYING MONEY

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 4 – Starting a commercial enterprise (continued)

INTERNET BANKING
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 5 – Financial concepts and the
Accounting equation
FINANCIAL CONCEPTS
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 5 – Financial concepts and the Accounting equation (continued)

CYCLE OF TRADING ACTIVITIES

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 5 – Financial concepts and the Accounting equation (continued)

THE DOUBLE-ENTRY SYSTEM

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 5 – Financial concepts and the Accounting equation (continued)

THE ACCOUNTING EQUATION

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 6 –Trading concerns; principles
regarding double entries
THE GENERAL LEDGER
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 6 –Trading concerns; principles regarding double entries
(continued)

APPLY THE DOUBLE-ENTRY PRINCIPLE

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 6 –Trading concerns; principles regarding double entries
(continued)

GROUPING OF LEDGER ACCOUNTS

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 6 –Trading concerns; principles regarding double entries
(continued)

THE CONTINUOUS STOCK SYSTEM

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 6 –Trading concerns; principles regarding double entries
(continued)

THE PERIODIC STOCK SYSTEM

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 6 –Trading concerns; principles regarding double entries
(continued)

THE TRIAL BALANCE

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 7 – Cash receipts journal and transfer
(post) to the ledger
CASH RECIEPTS JOURNAL
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 7 – Cash receipts journal and transfer (post) to the ledger
(continued)

POSTING FROM THE CASH RECEIPTS JOURNAL TO THE GENERAL

LEDGER
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 8 – Cash payments and transfer (post) to
the ledger
CASH PAYMENTS JOURNAL
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 8 – Cash payments and transfer (post) to the ledger (continued)

POSTING FROM THE CASH PAYMENTS JOURNAL TO THE GENERAL

LEDGER
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 8 – Cash payments and transfer (post) to the ledger (continued)

CASH RECIEPTS JOUNRAL AD THE CASH PAYMENTS JOURNAL

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 9 – Analysis Cash book and transfer
(post) to the ledger
ANALYSIS CASH BOOK
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 10 – Petty cash journal

THE PETTY CASH JOURNAL

The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 10 – Petty cash journal (continued)

THE PETTY CASH VOUCHER

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 10 – Petty cash journal (continued)

THE IMPREST SYSTEM

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 11 – Wages and salaries journal

TYPES OF WAGE SYSTEMS

The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 11 – Wages and salaries journal (continued)

OVERTIME REMUNERATION
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 11 – Wages and salaries journal (continued)

DEDUCTIONS
Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 11 – Wages and salaries journal (continued)

THE WAGE JOURNAL

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 11 – Wages and salaries journal (continued)

THE SALARY JOURNAL

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 12 – Bank reconciliation

BANK RECONCILIATION
The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 12 – Bank reconciliation (continued)

PROCEDURAL RULES FOR RECONCILIATION

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 12 – Bank reconciliation (continued)

DRAWING UP A BANK RECONCILIATION STATEMENT

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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 Module 13 – End-of-year procedure

THE CONCEPT OF PROFIT

The following concepts are used in accounting:
• Assets;
• Owner’s equity;
• Capital;
• Liabilities
• Expenses; and
• Income.
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 Module 13 – End-of-year procedure (continued)

FINAL ACCOUNTS AND CLOSING PROCEDURE

Most transactions are accompanied by source documents. Source
documents represent the starting point of the recording process, providing
detailed information from which each transaction is systematically classified
and filed and subsequently entered into the respective books of prime entry.

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