© the mcgraw-hill companies, inc., 1999 irwin/mcgraw-hill introduction accounting: the language of...

© The McGraw-Hill Companies, Inc., 1999Irwin/McGraw-Hill

INTRODUCTION

Accounting: The Language of Business

© The McGraw-Hill Companies, Inc., 1999Irwin/McGraw-Hill

Question oneQuestion one

What kind of information is helpful for your decision making if you plan to run a restaurant near the campus?

How many employees are required?

How many tables and chairs are needed?

What is the expected profit?

Where do you get the funds?

What are all the economic activities?

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Question oneQuestion one

What kind of information is helpful for your decision making if you plan to run a restaurant near the campus?

accounting information

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Accounting is the language of business

Accounting is the language of business

Summarize and interpret information for decision

makers.

Classify similar

transactions into useful

reports.

Analyze business

transactions.

In financial or monetary terms

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An event that has a direct effect on the operations of an economic unit and can be expressed in monetary terms

BusinessTransaction=Accounting

Transaction

BusinessTransaction=Accounting

Transaction

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An outline of the history of Accounting

An outline of the history of Accounting

Prelude period: tying knots on ropes

结绳记事

Making marks on the w

all

Double-entry bookkeeping

复式记账法

Birth of Bookkeeping

single-entry bookkeeping

单式记账法

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Present status: four major schoolsPresent status: four major schools

British school

American school

Socialist school

International school

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Integrity of Accounting InformationIntegrity of Accounting Information

Generally Accepted Accounting Principles

（一般公认会计准则）

True and fair view （真实和公允原则）

Accounting Standards for Business Enterprises

（企业会计准则）

General Financial Rules for Business Enterprises

（企业财务通则）

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Accounting and BookkeepingAccounting and BookkeepingItem Bookkeeping( 簿记 ) Accounting( 会计 )

Scope The recording of transactions, only a small segment of accounting

Bookkeeping, tax work and financial forecast, designing the system of records, preparation and interpretation of reports

Definition The work can be handled by mechanical and

electronic equipment.

It is an art, which need much higher level of knowledge and analytical skills, and conceptual understanding.

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Classification of AccountingClassification of Accounting

Private accounting 企业会计 Public accounting 公众会计

Serving one single enterprise Serving the whole society

Chief controller

CFO

CPA 注册会计师

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“Big four” international CPA firms“Big four” international CPA firms

KPMG: WWW.KPMG.COM

( 毕马威会计师事务所 )

PWC: WWW.PRICEWC.COM

( 普华永道会计师事务所 )

Ernst&Yong: www.ey.com

( 安永会计师事务所 )

Deloitte&Touche: www.dt.com

( 德勤会计师事务所 )

© The McGraw-Hill Companies, Inc., 1999Irwin/McGraw-Hill

Professional Organizationsin the UK and the US

Professional Organizationsin the UK and the US

Association of Chartered Certified Accountants

英国特许公认会计师协会American Institute of Certified Public Accountants

美国注册会计师协会 Financial Accounting Standards Board

（美国）财务会计准则委员会International Accounting Standards Committee

国际会计准则委员会

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Financial accounting and managerial accounting

Financial accounting and managerial accounting

Financial accounting records the transactions of a business entity and summarizes them in accordance with accounting principles and company law.

Managerial accounting provides information that helps managers plan, evaluate company

activities and make business decisions.

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The primary financial

statements.

Objectives of External Financial Reporting

Objectives of External Financial Reporting

Income Statement

Balance Sheet

Statement of Cash Flows

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Accounting entityAccounting entity

A profit-seeking business entity

Sole proprietorship

Partnership

Corporation

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Typical S im ple O rganization C hart

PlantAccountant

PlantManager

PlantAccountant

PlantManager

Business UnitManager

V.P. HumanResources

V.P. InformationServices

Chief FinancialOfficer (CFO)

Chief ExecutiveOfficer(CEO)

Board ofDirectors(Owners)

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End of Introduction End of Introduction