1. INTRODUCTION TO
FINANCIAL ACCOUNTS

2. Definitions
 Accounting is the art of recording,
classifying and summarizing in a
significant manner and in terms of
money, transactions and events
which are, in part at least, of a
financial character, and interpreting
the results thereof
 Book keeping is the science and art
of correctly recording in the books of
account, all those business
transactions that results in the
transfer of money or money’s worth

3. Users of Financial information
 Managers
 Owners
 Investors
 Government and regulatory authority
 Banks and Financial institutions
 Suppliers
 Employees
 Researchers
 The public

4. Objectives of Accounting
 To keep systematic record
 To ascertain the result of
operations
 To ascertain financial position of
the business
 To protect business property
 To facilitate rational decision
making

5. Role and activities of an
Accountant
 He is a one who Is engage in accounts
keeping
 He is functionary who aids control
 He is fiscal adviser
 He verifies, authenticates, and certifies the
accounts of an entity
 He produce an income statement and
balance sheet for an accounting period
 He is a professional whose primary duties
are concerned with information
management for internal and external use

6. Accounting personnel
 Internal auditor
 Controller
 Treasurer
 Finance officer

7. Accounting Concepts
These are the basic assumptions upon which the science of
accounting is based
 Business entity concept
 Money measurement concept
 Going concern concept
 Cost concept
 Accrual concept
 Concept of conservatism
 Materiality concept
 Consistency concept
 Periodicity concept

8. Changing nature of generally
accepted accounting principles
(GAAP)

9. Accounting cycle
 Identification of transactions
 Business documents
 Recording transactions
 Posting
 Trial balance
 Adjustment entries
 Closing entries
 Final accounts
 Reverse entries

10. Personal Account
DEBIT=the receiver
CREDIT= the giver

11. Real Account
 DEBIT= what comes in
 CREDIT- what goes out

12. Nominal Account
 DEBIT= expanses and losses
 CREDIT= incomes and gains