Role of an Account

Question 1

Management accounting

Answer 1

It focuses on planning, control and decision making.
It is prepared for internal use; to provide information for internal rather than external stakeholders (e.g. owners and senior employees).

Question 2

Planning

Answer 2

It includes the preparation of budgets

Question 3

Control

Answer 3

It includes standard costing and calculating variances between budgeted costs and actual costs

Question 4

Decision making

Answer 4

It may be short term (using marginal costing) or long term (using capital investment appraisal)

Question 5

Responsibilities of an accountant

Answer 5

Prepare financial statements on behalf of a business

• Auditing, which means checking whether the financial statements prepared by a business provide a true and fair view of its financial performance

Introduce accounting procedures for new businesses

• Analyse financial information to provide advice about where the financial performance could be improved.

• Produce budgets for businesses.

• Ensure that financial statements and tax returns are submitted by deadlines

Question 6

Examples of financial statements

Answer 6

Income statement
Statement of financial position
Annual report

Question 7

Book - keeper

Answer 7

They are responsible for recording day - to - day transactions:
- Maintaining accounting records
- Entering transactions in the books of prime entry and the ledgers
- Checking the accuracy of accounting records

Question 8

Book keeper

Answer 8

Also described as ledger clerks

Question 9

Accountants

Answer 9

ACCOUNTANTS are responsible for the actual preparation of the financial statements:
Income statement
• Statement of financial position