Week 1 Flashcards
Define accounting
The process of identifying, measuring, recording, and communicating economic transactions
Information put together in financial statement so users can make an informed decision
What is the ICAEW?
The institute of the Chartered Accountants in England and Wales
Symbol represents role of accountants:
Rod represents idea that accountants in control- authoritative
Rudder at the bottom represents idea that accountants guide business in right direction- should be consistent message and guidance
Dividers (compass looking symbol) on the right represents idea that accountants are responsible for measurement- measure various mathematical numbers etc
How have accountants been important during COVID?
Businesses and individuals need advice about how to apply and benefit from the new furlough scheme grants introduced by the government
Advise businesses about how to obtain finance and prepare cash flow forecasts
Careful cash management
Tell businesses how to survive and thrive during COVID
How have accountants been important during Brexit?
Provide businesses information about new tariffs and VAT legislation after Brexit
Accountants are helping to push for a deal
Accountants are also preparing businesses for the fact that there may not be a deal
Give advice about how to manage their businesses to ensure that they continue making as much profit as possible and sustain profit margins as much as possible and maintain cash flow etc
How have accountants been important and how will they continue to be important during the 4th industrial revolution?
Artificial intelligence
Block chain
Cyber security
Advanced data analytics
Using technologies above to help businesses improve efficiency
Accountants concerned about security of data
Accountants helping businesses reach customers in new, more efficient, effective ways
Crucially what will accountants have to do going forward?
Crucially accountants have key role in trying to measure all metrics (including new metrics never encountered by accountants before)- will have to move away from financial world
Measure, account, audit etc these new metrics
What does ICAEW stand for?
Institute of Chartered Accountants in England and Wales
List the ‘Big 4’ accounting/professional services firms and their purpose?
Purpose- offer a variety of different services e.g. audit (about verifying truthfulness and fairness of a companies accounting information), taxation and other consultancy services
KPMG
PWC
Deloitte
EY
What is the mission statement for ICAEW?
To Build a World of Strong Economies
What is the mission statement for ACCA?
We’re a force for public good. We lead the global accountancy profession by creating opportunity.
What is the mission statement for PWC?
To build trust in society and solve important problems
What is the mission statement for EY?
Building a better working world
In 2019 there were more people aged <35 than >35 in professional services firms?
Yes true: In 2019 18% of people working for professional services firms were under 25, 34% were under 25-34, 19% were 35-44, 15% were 45-54, 13% were 55-64 and only 1% were >65.
List the main professional accounting bodies and their purpose
Purpose- training and monitoring the behaviour of their members (accountants)
ACCA
ICAEW
CIMA
FRC (financial reporting council)- regulator in U.K
AIA
ICAS
What is the difference between financial and management accounting?
A
