Accounting Acumen is the ability to make good judgements and quick business decisions, based on accounting information. It is the first step in learning how to understand business language and to read and analyse financial statements. Level 1 is a foundational course, covering basic accounting principles and mechanics that will prepare you for more advanced levels of understanding and analysis. Level 1 follows a very practical approach that will teach you what a business is and the legal forms businesses can use; the typical transactions a business will conduct and how to record these transactions. It will teach you about the accounting process (based on the accounting equation) that is necessary to transform the transactional data into useful information that tells the story of a business.
You will learn about the three main steps in the accounting process, which is just like any typical process:
INPUTS, such as journals and special journals;
PROCESSING, such as posting to ledger accounts, and different types of accounts and special ledgers; and
OUTPUTS, such as the trial balance and how and when to adjust it.
Most importantly, you will learn all about how the financial information in the Trial Balance is packaged into the REPORTSthat form the Financial Statements based on rules that are much like language rules, namely:
This will enable you to complete the full accounting process by:
identifying accounting source documents containing transactions;
recording these transactions in various journals;
posting the journals to various ledgers accounts;
assemble a trial balance;
make adjusting entries to finalise the trial balance;
assemble the financial statement reports: i.e an income statement, statement if changes in equity, balance sheet from the trial balance.
You will test your newly acquired skills by completing an integrated exercise covering the entire accounting process, as described above.
This will prepare you to advance to the next levels of Accounting Acumen.
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