Semester 4, Lesson 6 (51)
ACCOUNTING AND BOOKKEEPING
I.
Read the following words and word combination and learn their meanings by
heart:
Accounting [q'kauntiN] бухгалтерський облік; an
accountant - бухгалтер; an account - рахунок; relevant [`relivqnt] financial data ['deitq] відповідна
фінансова інформація; a financial statement - фінансовий звіт, a profit and
loss account - рахунок доходів та витрат; balance sheet ['bxlqns Si:t] баланс; cash [kxS] готівка; previous [`prJviqs] попередній; revenue ['revinju:] дохід; costs [kOsts] вартість, затрати; overheads [ouvq'hedz]
накладні затрати; appropriation [a,proupri'eiSn] розподіл; remains [ri'meinz] залишки; assets [`xsets] активи; fixed assets - основні засоби; current [`kArqnt] assets - обіговий капітал; liabilities
[laiq'bilItiz] зобов'язання, борги, пассив (балансу); current liabilities - поточні
зобов'язання; long-term liabilities - довгострокові зобов'язання; a double
entry system ['dAbl'entri'sistim] система подвійного
запису; bookkeeping [buk'kJpiN] бухгалтерський облік; a bookkeeper
- рахівник; a purchase [`pWCIs] придбання, купівля; receipts
[ri'si:ts] одержання, прибуток; disbursements [dis'bWsmant] витрата, оплата; a journal [`Gз:nq1] журнал; a
Ledger ['leGq] головна книга; value ['vxlju:] вартість, a payment [peimqnt] плата,
оплата; a trial [traiql] перевірка, to match [mxC] збігатись; understandable ['Andq'stxndqbl] зрозумілий; Standards [stxndqdz] of Accounting - Положення (стандарти)
бухгалтерського обліку, equation [ɪˈkweɪʒən,
- Sqn] рівняння,
to equal ['Jkwql]дорівнювати
II. Try
to repeat a tongue twister several times, as quickly as possible, without
stumbling or mispronouncing:
Pick a partner and practice passing,
for if you pass proficiently, perhaps you'll play professionally.
III. Read and translate text 14:
TEXT 14 ACCOUNTING
AND BOOKKEEPING
I
The aim of accounting is to show a financial condition of a company. It is an accounting
department of a firm that records and measures all relevant financial data
of its business activity. There are the two types of records which are the most
important ones. They are the income statement and the balance sheet.
Who are the users of accounting records? There is a
wide range of different users of these records or, as specialists often say financial reporting or financial
statements. They are stockholders, present and potential investors and
creditors, management, independent analysts, banks, debtors, competitors,
tax bodies, government.
Accounting can be defined as recording and measuring
of all financial data concerning a given business or organization
activity.
Financial Statements are the central feature of
accounting because they are the primary means of communicating important
accounting information to users. They show business in financial terms. The
most important financial documents are: 1. Profit and Loss Accounts; 2.
Balance Sheets; 3. Cash flow
Forecast.
Profit and loss accounts give a "history" of a company's finances during the
previous year for some period.
Balance sheets show the financial position of a
company on a certain date. Figuratively speaking, a balance sheet provides the so-called "a
shapshot" of a company's wealth at a very given moment of time. It
has three sections:
1. Assets
(fixed and current);
2. Liabilities (current
and long-term);
3. Owner’s Equity.
If money is often referred to as "the blood of
business" and accounting is referred as "the language of
business", then double-entry system may be referred as "the eyes of
accounting".
The double-entry system of accounting requires that
for each transaction there must be one or more accounts debited and one or more
accounts credited. So, the rule requires that total debits must
equal total credits.
Look at the accounting equation: Assets = Liabilities
+ Owner's Equity.
II
Bookkeepers deal
with taxes and cash flow which reflect business transactions of a company, such
as sales and purchases, receipts and disbursements.
Bookkeepers first record figures in the books
or journals. Of course the books of today are computer files. At the end of
each period bookkeepers post the totals of each book into the Ledger.
What is the difference between accountants and
bookkeepers?
As we see bookkeepers are not librarians, who
also keep books. They are not
bookmakers, who "make books".
They are specialists who record business transactions and periodically do a
trial to see if both sides of an account book match.
Accountants, however, analyze financial records and
decide how to present them. It is a special art to prepare the relevant meaningful
financial report from the given data. In short, accountants make
financial information understandable for users.The accountant also determines
ways in which the business will grow
in the future. They help to expand or reorganize the business.
Many accountants pass examinations to get special certificates. In England
they are called chartered accountants, while in the USA - certified
public accountants.
IV. Retell
the text according to the following questions:
1. What is
the aim of accounting? 2. What two types of records do you know ? 3. What users
of financial statements can you name? 4. What do financial statements show ? 5.
What are the three most important financial documents ? 6. Do profit and loss
accounts give "a history" of a company's finances? 7. Balance sheets
show the financial position of a company on a certain date, don't they? 8. How
many sections are there in balance sheets? 9. What is the essence of the
double-entry system?
V. Put some (7 or 10) questions
to the second part of the text.
VI. Ask so many
questions as you can to the sentences:
1. Accountants deal with
business transactions.
2. Accounting is referred as "the
language of business".
VII. Arrange the words into pairs of:
a) synonyms:
Company,
examination, condition, value,
position, firm, cost, to affect, part, to influence, to show, primary, to
reflect, main, section, money, capital, wealth, currency, trial.
b) antonyms:
Debit,
receipts, important, credit, disbursements, rarely, insignificant, poverty,
purchase, sales, narrow, expense, same, wide, different, often, wealth, income.
VIII. Translate into English:
1. Мета
бухгалтерського обліку - показати фінансовий стан організацій.
2.
Користувачами бухгалтерської інформації є інвестори, кредитори, акціонери,
керівництво, банки, податкові органи, конкуренти.
3.
Бухгалтерський облік - це реєстрування і обчислення всієї фінансової
інформації, яка стосується діяльності певного бізнесу або підприємства.
4.
Найважливішими фінансовими документами є балансові звіти, рахунки доходів і
витрат та руху готівки.
5. Фінансові
звіти є стрижнем бухгалтерського обліку, оскільки вони - основний засіб
передачі важливої бухгалтерської інформації до споживачів. 6.Балансовий звіт
показує фінансовий стан організації на певний час. 7.Система подвійного запису вимагає, щоб
дебетова сторона балансу дорівнювала кредитовій стороні. 8. Рахівники записують
ділові операції і періодично перевіряють,, чи обидві сторони книги рахунків
співпадають. 9. Бухгалтери аналізують фінансові записи і вирішують, як їх
представити, тобто вони роблять фінансову інформацію зрозумілою для споживачів.
10. Систему подвійного запису можна назвати „очима бухгалтерського
обліку".
IX. Match
the questions with the answers:
1. Are you
an accountant? 2. Do you spend your time writing down credits and debits,
adding figures all days through? It seems to me rather dull. But some people
like such a job. 3. What do accountants do?
a) That's bookkeeping. Which, you know, is
not the same thing at all.
b) Yes, I am an accountant. And I am proud of
it.
c) You see, accountants record cash flows,
calculate profits and losses. They also record the value of assets and
liabilities. But we, accountants, do more than that. We supply people with
information. We take part in a company's making of decisions.
X. Read and translate the meanings of the
following terms. Translate the sentences with them.
Accounting - 1) is the work of keeping or
checking accounts; accountancy (syn). 2) is the work and profession of an
accountant; 3) is recording the money value of business dealings.
1. She works in accounting. 2.
Accounting is a system of recording the money value of business dealings and
income and expenditure accounts to enable the management of a concern to see
the financial position at any time. 3.In a centralized accounting system, all cash
payments are made by the central accounting office. 4. Accounting malpractice
toward a client can arise, for instance, when accountants present a negligently
prepared financial statement to the client, and the client relies on it and is
injured.
Asset - is an item of value belonging to
a person or a company, such as a share, a piece of land, a building or a
machine, especially if it can be sold to pay a debt.
1. The company was forced to sell
off its assets. 2. His assets included shares in the company and a house in the
country. 3.A sense of humour is a real asset in this business. 4. Asset,
liability, and stockholders' equity accounts are permanent accounts. 5. Assets
are the items of value owned by a business. 6. The total annual expenses of the
asset are spread out fairly evenly over the asset's life. 7. The amount of
depreciation is calculated using the asset's current book value. 8. An asset is
defined as anything of value that is owned by the person, corporation, or
institution in question.
Cash - 1) is money in the form of
banknotes and coins; 2) is money or finance generally.
1. Small amounts are usually paid in
cash rather than by cheque. 2. The company is short of cash at the moment. 3. I
never carry much cash with me. 4.According to various laws, the assessed value of property for tax
purposes must represent either the full fair market, or cash value of the
property or a specified percentage of such value.
XI. Read text 15 and
try to fill in the gaps with the given words.
TEXT 15 DIFFERENCE
BETWEEN A BOOK-KEEPING AND AN ACCOUNTING, A BOOK-KEEPER AND AN ACCOUNTANT
Words:
Decision-making, years, a book-keeper, department, transactions, analysing,
recording, months, accounting, management, repeated, financial, weeks,
knowledge
Some people confuse a 1) with an accountant and book-keeping
with
2) .Meanwhile the distinction between them is
significant enough. Book-keeping is one of the parts of the whole of
accounting. It can be defined as the procedure used in 3) business 4) . Book-keeping requires only minimal 5) of accounting. In fact, it is the routine and
clerical side of accounting. A book-keeper is known to record 6) and uncomplicated transactions
of business. In contrast the accountant is a professional who is competent in 7) accounting information, systems design and
8) advising. An
accountant uses accounting experience to help the
9) in 10) . As for the book-keeper, his
function is that of a clerk working in a finance 11) . A person might become a
proficient book-keeper in a few 12)
or 13) . To
become a professional accountant, however, is a far greater challenge. It
requires 14) of study and
experience.
XII. 1. Complete the table writing down
the main features of an accountant and a bookkeeper. Use information from Ex.
III, VIII, X, XI.
An Accountant |
A Bookkeeper |
1. analyzes financial
records and decides how to present them… |
1. records figures… |
XIII. Individual work: read text 16 and answer the following question “What is the difference between an accountaning and bookkeeping?”
TEXT 16
Am I an Accountant or a Bookkeeper?
This is a common question we can hear from individuals performing
day-to-day financial services for a company. Most people, even accountants, don't know the answer to this
question. And, in most cases the answer doesn't matter. But, in those
cases where someone wants to be technically correct the answer lies in what services a person
performs. If a person is doing bookkeeping, they are a bookkeeper. If they are
doing accounting, they are an accountant.
What is Bookkeeping?
There are eight steps to the bookkeeping cycle.
A bookkeeper is a person that performs one or more of these steps or sometimes
called AAT (accounting technicians). In large companies, for instance, the
bookkeeping cycle might be divided into departments such as Accounts
Receivable, Accounts Payable, or Payroll. While most often these people are
referred to as "clerks", they might also be considered bookkeepers as
they are "keeping the books" for a company. In small companies, the
bookkeeper may perform the entire bookkeeping process, or might just enter data
to give to the
"accountant".
All bookkeeping steps are mechanical in nature. Bookkeeping
is a regimented process usually occurring in monthly cycles consisting
of entering transactions into the journals, making adjustments, and preparing
reports. The Accounts Receivable Clerk may be assigned to enter all sales on
account, and all payments from the customers. The Accounts Payable Clerk's
responsibility would be to enter purchase orders and checks. Again, in a small
company, both duties may be performed by the same person.
The full-charge bookkeeper is someone who can do it
all - including compiling the data into the General Ledger and preparing
financial statements.
What is Accounting?
Someone has to
set up the bookkeeping system, monitor it, and interpret the results. These
processes are called "Accounting." The accounting process is much
less mechanical and more subjective. It begins with designing a system that
will benefit the business, by capturing the financial information in a useful
manner without being overly burdensome to the bookkeeper. Once set up, the
accountant monitors the system to ensure it's doing what it's supposed to do.
And finally, on a monthly basis usually, the accountant presents the financial statements to the business
management in such a way that decisions can be made.
Since accounting requires an understanding of the
bookkeeping process, accountants typically supervise the bookkeepers. In a
large corporation there may be several, possibly even thousands of accountants.
One will be designated as the "Controller" who oversees the entire accounting and bookkeeping system.
In a small business, one person, often a freelancer (a contract accountant or
full charge bookkeeper) will perform all the phases of accounting and
bookkeeping for a company. Since "Accountant" is the more prestigious
title, most small business jack-of-all-trades call themselves an
"Accountant".