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Module-1 - Introduction To Financial Accounting

This document provides an introduction to financial accounting. It discusses the forms of business organizations, the corporate organizational structure, what accounting is, the accounting information system, the differences between financial and management accounting, users of accounting information, accounting principles, institutions that regulate accounting, and international accounting standards. The document is meant as an overview of key concepts in financial accounting for students.

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Ambarish Chatterjee
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142 views12 pages

Module-1 - Introduction To Financial Accounting

This document provides an introduction to financial accounting. It discusses the forms of business organizations, the corporate organizational structure, what accounting is, the accounting information system, the differences between financial and management accounting, users of accounting information, accounting principles, institutions that regulate accounting, and international accounting standards. The document is meant as an overview of key concepts in financial accounting for students.

Uploaded by

Ambarish Chatterjee
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Introduction to Financial Accounting

Thota Nagaraju
Dept of Econ & Fin
BITS-Pilani Hyd Campus
FOFA: Accounting Part
Topic: Introduction to Financial Accounting

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 1
Business Organizations

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 2
Forms of Business Organization

➢ Sole proprietorship
➢ Partnership
➢ Limited company
Limited liability partnership
Legal formalities for a limited company

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 3
The Corporate Organization Structure

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 4
Accounting, Markets and Governance

➢ The lemons principle and the problem of adverse selection


➢ Signaling quality
➢ Moral hazard and corporate governance

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 5
What is Accounting

➢ Accounting is the language of business


➢ Who should know accounting?
➢ Accounting information and economic decisions

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 6
The Accounting Information System

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 7
Financial Accounting and Management Accounting

➢ Financial accounting
➢ Management accounting
➢ How do they differ?

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 8
Users of Accounting Information
➢ Investors
➢ Lenders
➢ Analysts and advisers
➢ Managers
➢ Employees and trade unions
➢ Suppliers and trade financiers
➢ Auditors
➢ Customers
➢ Government and regulatory authorities
➢ The public
Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 9
Accounting Principles

➢ Reporting entity
➢ Going concern
➢ Historical cost
➢ Periodicity
➢ Money measurement

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 10
Institutions that Regulate Accounting

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 11
Ind AS, IFRS and US GAAP

➢ Indian Accounting Standards (Ind AS)


➢ Ind AS and IFRS
➢ IFRS and US GAAP
➢ Principles or rules?

Thota Nagaraju BITS-Pilani Hyderabad Campus Fundamentals of Finance & Accounting First Sem 2023-24 12

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