CITY & GUILDS
PITMAN QUALIFICATIONS
Book-keeping And Account
United Kingdom for City & Guilds and Pitman Qualifications
in over 85 countries. We are the leading assessment and awarding body for vocational
qualifications in United Kingdom.
Book-keeping and Accounts LEVEL 1
Aim |
The aim of the examination is to test the candidate's ability, within the context
of a simple sole trader business.
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Target population |
The examination is aimed at people seeking a first qualification in book-keeping and
accounts. This examination is both a single subject, demonstrating an understanding of
book-keeping and accounts within a business/secretarial studies foundation course and a
foundation upon which to progress within this particular area of study. Candidates who
are successful in this examination would be qualified to fulfil a junior role in an accounts
office.
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Objectives |
Candidates should be able to complete the following.
Apply principles, concepts and conventions used in the preparation
of account statements, including the concepts of business entity, prudence, consistency,
materiality and going concern.
Record capital as real assets as well as cash, fixed assets, current assets, current
liabilities, gross and net profit.
Distinguish between and give examples of: revenue and capital expenditure; debtors
and creditors; expenditure and income.
Illustrate the relationship of net profit to the capital account.
Prepare a capital account to record initial capital invested, cash drawing and net profit
transferred from the profit and loss account.
Interpret basic accounting terms and documentation including: invoices, statements,
credit notes, advice notes, delivery notes, despatch notes.
Record by double-entry book-keeping simple transactions concerning the purchase of assets
and the purchase and sale of goods; purchase returns and sales returns.
Prepare a two column cash book to record the receipt and payments of
cash, cheques, standing orders, direct debits.
Show an understanding of the functions and operations of current bank accounts, the
paying-in book, bank statements.
Interpret bank statements and cash book in order to draft bank reconciliation statements.
Use vouchers to prepare a petty cash book, with analysis columns, using the imprest method;
balance the petty cash book and transfer the totals to the ledger accounts as necessary.
Balance the ledger accounts including the cash and bank accounts and
bring down the balances to the following accounting period.
Extract the trial balance from the ledger accounts and discuss its uses
and limitations.
Prepare simple trading and profit and loss accounts from the trial balance
and other information provided; showing opening and closing stocks; the calculation of cost
of goods sold; gross and net profit.
Prepare simple stock accounts, showing transfers to and from the trading
account.
Prepare simple balance sheets in vertical and horizontal formats.
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Book-keeping and Accounts LEVEL 2
Aim |
The aim of the examination is to test the candidate's ability, within the context
of a simple sole trader business.
Process a full range of financial transactions using double-entry
book-keeping.
Prepare control statements.
Check and correct accounting records as necessary.
Display comprehensive financial information about the state of the
business.
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Objectives |
Candidates should be able to complete the following.
Record in the journal proper the opening and closing balances of the
business; the correction of errors; the purchase and sale of assets.
Prepare books of original entry including the sales day book, the
purchases day book, the sales returns book and the purchases returns book.
Apply the relationship between the day books, including the journal
and the ledger accounts.
Sub-divide the ledger into personal, real and nominal accounts; the
sales ledger and purchases ledger.
Prepare a three column cash book distinguishing between cash discounts
and trade discounts; discounts received and discount allowed. Transfer the totals of the
discount columns to the respective discount accounts.
Apply procedures to discover why the trial balance does not agree.
Be aware of the type of error shown and those not shown by the trial
balance; prepare a suspense account and correct errors.
Make simple adjustments for prepayments and accruals.
Record depreciation using the straight line and reducing balance
methods; prepare the depreciation account and depreciation provision account.
Record bad debts and provision for bad and doubtful debts.
Apply an understanding of stock taking and stock valuation; and
be aware of the effect of stock valuation on the profit figure.
Record drawings in kind as well as in cash.
Prepare trading and profit and loss accounts, making adjustments for
returns, prepayments, accruals, depreciation and doubtful debts provisions. Treatment of
net loss. Calculation of net purchases, net sales, cost of goods sold.
Prepare a balance sheet showing the order of permanence of assets
and working capital.
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Accounting LEVEL 3
Aim |
The aim of the examination is to test the candidate's ability to
record and interpret the financial transactions, prepare financial statements
up to and including final accounts of various organisations, which could include incomplete
records and
make routine decisions with the minimum of supervision.
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Target population |
This level of study should appeal to a range of persons of all ages whether receiving
tuition on a full or part time basis. It is intended for those who need a certificate of
accounting competence at technician level for immediate vocational need. It is also suited
to those who aspire to become a Section Leader in a large organisation or a Senior Book-keeper
in a small organisation. Successful candidates would also be competent to act as Secretaries
to clubs and voluntary societies.
This Accounting syllabus is a useful complement to the study of Cost and Management Accounting.
It will also serve as a basis for those wishing to specialise in Cost and management Accounting
at a later stage.
A knowledge of principles of book-keeping up to Pitman Qualifications Level 2 standard is
expected.
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Objectives
1 Sole trader and partnerships |
Candidates should be able to complete the following.
- Define a sole trader and a partnership form of organisation.
Record the accounting entries from source documents using books of prime
entry (day books) where appropriate.
Basic recording skills will be competent up to and including the extraction
of a trial balance.
Form a simple partnership from a sole trader entity.
Prepare the end of period accounts for a sole trader and partnerships
including
- closing stock
- depreciation (including provisions)
- accruals
- Prepayments
- bad debts written off
- provision for bad debts.
Prepare the appropriation accounts for a partnership including the
appropriation of net profit/loss as per a partnership agreement including any or all of the
following
- interest on partners capital accounts
- interest on partners drawings
- partners salaries and commission
- distribution of final residue of profit/loss.
Apply the provisions of the UK 1890 Partnership Act in so far as they
apply to the distribution of profits and losses.
Know the difference between fixed capital accounts and current accounts;
write up relevant accounts.
Define a limited liability company.
Analyse the advantages and disadvantages of a limited company as a
form of business organisation. |
2 Limited liability companies |
- Define ordinary shares, preference shares, debentures, equity capital and loan capital.
Make formal entries in the books of account for the issue of
(1) ordinary shares
(2) preference shares
(3) debentures.
Prepare a simple trading and profit and loss account including an
appropriation of profits between dividends and revenue reserves.
NB questions involving net losses will not be set.
Prepare a simple company balance sheet in both horizontal and
vertical form using a conventional presentation; present assets and liabilities in the
balance sheet in proper manner.
Incorporate the following adjustments into the end of period accounts:
- closing stock
- depreciation
- accruals
- prepayments
- bad debts written off
- provision for bad debts.
Produce a simple 'funds flow statement' from company data including
the computation of 'funds generated' involving the 'adding back' of depreciation.
OR
Produce a simple 'cash flow statement' from company data including
the computation of 'reconciliation of operating profit to net cash inflow from operating
activities'.
Note: Questions will be set in the examination with appropriate data
to enable candidates to either produce a funds flow or a cash flow statement.
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3 Non trading organisations |
Define a non trading organisation.
Distinguish between 'receipts and payments' and 'income and
expenditure' for an accounting period.
Calculate a capital (accumulated) fund.
Prepare end of period revenue account for clubs and societies.
Prepare end of period balance sheets for clubs and societies.
Compute any 'profits' or 'losses' for the club or society as
a result of running
(a) the sale of refreshments
(b) social or recreational fund raising activities
(c) disposal of capital equipment.
Be able to incorporate the following adjustments into the end of
period accounts:
- accruals
- prepayments
- subscriptions in advance
- subscriptions in arrears
- depreciation
- acquisition of capital equipment
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4 Special Areas |
Manufacturing
Incomplete records
Define incomplete records.
Prepare simple period end accounts from incomplete records.
Prepare a 'statement of affairs' and use this as a means of computing
the profit of loss for a trading period.
Interpretation
Explain the function of trading, profit and loss account and balance
sheet.
Use simple ratios to evaluate profit and liquidity across different
organisations and across different trading periods.
Interpret a trading and profit and loss account and balance sheet and
be able to make basic management observations together with simple judgements and/or recommendations.
Calculate stock levels and valuations using selling price of cost price;
mark up or margin;
FIFO (first in first out)
LIFO (last in first out)
AVCO (weighted average cost)
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For further information, please contact:
INSTITUT PERDAGANGAN MUAR
107-3, (1st Floor), Jalan Hashim,
84000 Muar Johor.
Tel: 06-9522257
ipm@tm.net.my
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