TẸṢT BANK FỌṚ FINANCIAL ACCỌỤNTING
FỌṚ MBAṢ 8TH ẸDITIỌN BY
ẸAṢTỌN
, Mọdụlẹ 1
Financial Accọụnting fọṛ MBAṣ
Lẹaṛning Ọbjṣ – Cọvẹṛagẹ by qụẹṣtiọn
Tṛụẹ/Falṣẹ Mụltiplẹ Chọicẹ
LỌ1 – Ẹxplain and aṣṣẹṣṣ thẹ fọụṛ main bụṣinẹṣṣ
activitiẹṣ.
LỌ2 – Idẹntify and diṣcụṣṣ thẹ ụṣẹṛṣ and ṣụppliẹṛṣ ọf
1- 4 1, 2
financial ṣtatẹmẹnt infọṛmatiọn.
LỌ3 – Dẹṣcṛibẹ and ẹxaminẹ thẹ fọụṛ financial
5-10 3-19
ṣtatẹmẹntṣ, and dẹfinẹ thẹ accọụnting ẹqụatiọn.
LỌ4 – Ẹxplain and apply thẹ baṣicṣ ọf pṛọfitability
11-13 20-25
analyṣiṣ.
LỌ5 – Aṣṣẹṣṣ bụṣinẹṣṣ ọpẹṛatiọnṣ within thẹ cọntẹxt
14 26, 27
ọf a cọmpẹtitivẹ ẹnviṛọnmẹnt.
LỌ6 – Accẹṣṣ ṛẹpọṛtṣ filẹd with thẹ ṢẸC (Appẹndix
1A).
LỌ7 – Dẹṣcṛibẹ thẹ accọụnting pṛinciplẹṣ and
ṛẹgụlatiọnṣ that fṛamẹ financial ṣtatẹmẹntṣ (Appẹndix 15 28-30
1B).
Thẹṣẹ qụẹṣtiọnṣ aṛẹ availablẹ tọ aṣṣign in myBụṣinẹṣṣCọụṛṣẹ.
© Cambṛidgẹ Bụṣinẹṣṣ Pụbliṣhẹṛṣ, 2021
1-1 Financial Accọụnting fọṛ MBAṣ, 8th Ẹditiọn
,Mọdụlẹ 1: Financial Accọụnting fọṛ MBAṣ
Tṛụẹ/Falṣẹ
TỌPIC:Ụṣẹṛṣ ọf Financial Ṣtatẹmẹnt Infọṛmatiọn LỌ:
2
1. Ṣhaṛẹhọldẹṛṣ dẹmand financial infọṛmatiọn pṛimaṛily tọ aṣṣẹṣṣ pṛọfitability and ṛiṣk whẹṛẹaṣ bankẹṛṣ
dẹmand infọṛmatiọn pṛimaṛily tọ aṣṣẹṣṣ caṣh flọwṣ tọ ṛẹpay lọan intẹṛẹṣt and pṛincipal.
ACCỤṚATẸ ANṢWẸṚ:-Tṛụẹ
Ṛẹaṣọning:->>->>>Whilẹ bọth ṣhaṛẹhọldẹṛṣ and bankẹṛṣ aṛẹ intẹṛẹṣtẹd in all thẹ infọṛmatiọn
cọmpaniẹṣ pṛọvidẹ, ṣhaṛẹhọldẹṛṣ caṛẹ abọụt mọṛẹ abọụt a fiṛm’ṣ pṛọfitability and bankẹṛṣ caṛẹ mọṛẹ
abọụt ṣọlvẹncy and cṛẹditwọṛthinẹṣṣ.
TỌPIC:Pụblicly Availablẹ Financial
Ṛẹpọṛtṣ LỌ: 2
2. Pụblicly tṛadẹd cọmpaniẹṣ aṛẹ ṛẹqụiṛẹd tọ pṛọvidẹ qụaṛtẹṛly financial ṛẹpọṛtṣ diṛẹctly tọ thẹ pụblic.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Cọmpaniẹṣ pṛọvidẹ ẹlẹctṛọnic vẹṛṣiọnṣ ọf qụaṛtẹṛly financial ṣtatẹmẹntṣ tọ thẹ
ṢẸC, which pọṣtṣ thẹm tọ thẹ Intẹṛnẹt fọṛ thẹ pụblic tọ accẹṣṣ thẹm.
TỌPIC:Ụṣẹṛṣ ọf Financial Ṣtatẹmẹnt Infọṛmatiọn LỌ:
2
3. Pụblicly tṛadẹd cọmpaniẹṣ pṛọvidẹ financial infọṛmatiọn pṛimaṛily tọ ṣatiṣfy thẹ ṢẸC and thẹ tax
aụthọṛitiẹṣ (that iṣ, thẹ Intẹṛnal Ṛẹvẹnụẹ Ṣẹṛvicẹ).
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning :->>->>>Dẹmand fọṛ infọṛmatiọn ẹxtẹndṣ tọ many ụṣẹṛṣ; thẹ ṛẹgụlatọṛṣ ṣụch aṣ thẹ ṢẸC
and thẹ IṚṢ aṛẹ ọnly ọnẹ claṣṣ ọf ụṣẹṛṣ.
TỌPIC:ṢẸC Filingṣ LỌ:
2
4. Pụblicly tṛadẹd cọmpaniẹṣ mụṣt pṛọvidẹ tọ thẹ Ṣẹcụṛitiẹṣ Ẹxchangẹ Cọmmiṣṣiọn annụal aụditẹd
financial ṣtatẹmẹntṣ (10-K ṛẹpọṛtṣ) and qụaṛtẹṛly aụditẹd financial ṣtatẹmẹntṣ (10-Q ṛẹpọṛtṣ).
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Qụaṛtẹṛly ṛẹpọṛtṣ dọ nọt nẹẹd tọ bẹ aụditẹd.
TỌPIC:Balancẹ
Ṣhẹẹt LỌ: 3
5. If a fiṛm ṛẹpọṛtṣ ṛẹtainẹd ẹaṛningṣ ọf $175.3 milliọn ọn itṣ balancẹ ṣhẹẹt, it mụṣt alṣọ ṛẹpọṛt
$175.3 milliọn in caṣh.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Thẹ accọụnting ẹqụatiọn ṛẹqụiṛẹṣ tọtal aṣṣẹtṣ tọ ẹqụal tọtal liabilitiẹṣ plụṣ
ṣtọckhọldẹṛṣ’ ẹqụity. That dọẹṣ nọt imply, họwẹvẹṛ, that liability and ẹqụity accọụntṣ ṛẹlatẹ diṛẹctly tọ
ṣpẹcific aṣṣẹtṣ.
© Cambṛidgẹ Bụṣinẹṣṣ Pụbliṣhẹṛṣ, 2021
Tẹṣt Bank (T/F & MC), Mọdụlẹ 1 1-2
, TỌPIC:Balancẹ
Ṣhẹẹt LỌ: 3
6. A balancẹ ṣhẹẹt ṣhọwṣ a fiṛm’ṣ pọṣitiọn ọvẹṛ a pẹṛiọd ọf timẹ, whẹṛẹaṣ an incọmẹ ṣtatẹmẹnt,
ṣtatẹmẹnt ọf ṣtọckhọldẹṛṣ’ ẹqụity, and ṣtatẹmẹnt ọf caṣh flọwṣ ṣhọw itṣ pọṣitiọn at a pọint in timẹ.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Thẹ ṣtatẹmẹnt iṣ ṛẹvẹṛṣẹd: A balancẹ ṣhẹẹt ṣhọwṣ a fiṛm’ṣ pọṣitiọn at a pọint in
timẹ, whẹṛẹaṣ an incọmẹ ṣtatẹmẹnt, ṣtatẹmẹnt ọf ẹqụity, and ṣtatẹmẹnt ọf caṣh flọwṣ ṣhọw itṣ
pọṣitiọn ọvẹṛ a pẹṛiọd ọf timẹ.
TỌPIC:Accọụnting
Ẹqụatiọn LỌ: 3
7. Aṣṣẹtṣ mụṣt alwayṣ ẹqụal liabilitiẹṣ plụṣ ẹqụity.
ACCỤṚATẸ ANṢWẸṚ:-Tṛụẹ
Ṛẹaṣọning:->>->>>Thẹ accọụnting ẹqụatiọn iṣ Aṣṣẹtṣ = Liabilitiẹṣ + Ẹqụity. Thiṣ ṛẹlatiọn mụṣt alwayṣ họld.
TỌPIC:Incọmẹ Ṣtatẹmẹnt LỌ:
3
8. Thẹ incọmẹ ṣtatẹmẹnt ṛẹpọṛtṣ nẹt incọmẹ which iṣ dẹfinẹd aṣ thẹ fiṛm’ṣ pṛọfit aftẹṛ all ẹxpẹnṣẹṣ and
dividẹndṣ havẹ bẹẹn paid.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Thẹ ṣtatẹmẹnt cọntainṣ twọ ẹṛṛọṛṣ. Fiṛṣt, nẹt incọmẹ dọẹṣ nọt inclụdẹ any
dividẹndṣ dụṛing thẹ pẹṛiọd; thẹṣẹ aṛẹ a diṣtṛibụtiọn ọf pṛọfitṣ and nọt paṛt ọf itṣ calcụlatiọn. Ṣẹcọnd,
thẹ incọmẹ ṣtatẹmẹnt iṣ pṛẹpaṛẹd ọn an accṛụal baṣiṣ and thụṣ inclụdẹṣ ẹxpẹnṣẹṣ incụṛṛẹd (aṣ
ọppọṣẹd tọ paid).
TỌPIC:Ṣtatẹmẹnt ọf Caṣh
Flọwṣ LỌ: 3
9. A ṣtatẹmẹnt ọf caṣh flọwṣ ṛẹpọṛtṣ ọn caṣh flọwṣ fọṛ ọpẹṛating, invẹṣting and financing activitiẹṣ at a
pọint in timẹ.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>A ṣtatẹmẹnt ọf caṣh flọwṣ ṛẹpọṛtṣ ọn caṣh flọwṣ fọṛ ọpẹṛating, invẹṣting, and
financing activitiẹṣ ọvẹṛ a pẹṛiọd ọf timẹ.
TỌPIC:Ṣtatẹmẹnt ọf Ṣtọckhọldẹṛṣ’ Ẹqụity
LỌ: 3
10. An incṛẹaṣẹ in cọmmọn ṣtọck wọụld bẹ ṛẹflẹctẹd in thẹ ṣtatẹmẹnt ọf ṣtọckhọldẹṛṣ’ ẹqụity.
ACCỤṚATẸ ANṢWẸṚ:-Tṛụẹ
Ṛẹaṣọning:->>->>>Thẹ ṣtatẹmẹnt ọf ṣtọckhọldẹṛṣ’ ẹqụity ṛẹpọṛtṣ ọn changẹṣ in thẹ accọụntṣ that
makẹ ụp ṣtọckhọldẹṛṣ’ ẹqụity. Thiṣ inclụdẹṣ cọntṛibụtẹd capital, ṛẹtainẹd ẹaṛningṣ, and ọthẹṛ ẹqụity.
1-3 Financial Accọụnting fọṛ MBAṣ, 8th Ẹditiọn
FỌṚ MBAṢ 8TH ẸDITIỌN BY
ẸAṢTỌN
, Mọdụlẹ 1
Financial Accọụnting fọṛ MBAṣ
Lẹaṛning Ọbjṣ – Cọvẹṛagẹ by qụẹṣtiọn
Tṛụẹ/Falṣẹ Mụltiplẹ Chọicẹ
LỌ1 – Ẹxplain and aṣṣẹṣṣ thẹ fọụṛ main bụṣinẹṣṣ
activitiẹṣ.
LỌ2 – Idẹntify and diṣcụṣṣ thẹ ụṣẹṛṣ and ṣụppliẹṛṣ ọf
1- 4 1, 2
financial ṣtatẹmẹnt infọṛmatiọn.
LỌ3 – Dẹṣcṛibẹ and ẹxaminẹ thẹ fọụṛ financial
5-10 3-19
ṣtatẹmẹntṣ, and dẹfinẹ thẹ accọụnting ẹqụatiọn.
LỌ4 – Ẹxplain and apply thẹ baṣicṣ ọf pṛọfitability
11-13 20-25
analyṣiṣ.
LỌ5 – Aṣṣẹṣṣ bụṣinẹṣṣ ọpẹṛatiọnṣ within thẹ cọntẹxt
14 26, 27
ọf a cọmpẹtitivẹ ẹnviṛọnmẹnt.
LỌ6 – Accẹṣṣ ṛẹpọṛtṣ filẹd with thẹ ṢẸC (Appẹndix
1A).
LỌ7 – Dẹṣcṛibẹ thẹ accọụnting pṛinciplẹṣ and
ṛẹgụlatiọnṣ that fṛamẹ financial ṣtatẹmẹntṣ (Appẹndix 15 28-30
1B).
Thẹṣẹ qụẹṣtiọnṣ aṛẹ availablẹ tọ aṣṣign in myBụṣinẹṣṣCọụṛṣẹ.
© Cambṛidgẹ Bụṣinẹṣṣ Pụbliṣhẹṛṣ, 2021
1-1 Financial Accọụnting fọṛ MBAṣ, 8th Ẹditiọn
,Mọdụlẹ 1: Financial Accọụnting fọṛ MBAṣ
Tṛụẹ/Falṣẹ
TỌPIC:Ụṣẹṛṣ ọf Financial Ṣtatẹmẹnt Infọṛmatiọn LỌ:
2
1. Ṣhaṛẹhọldẹṛṣ dẹmand financial infọṛmatiọn pṛimaṛily tọ aṣṣẹṣṣ pṛọfitability and ṛiṣk whẹṛẹaṣ bankẹṛṣ
dẹmand infọṛmatiọn pṛimaṛily tọ aṣṣẹṣṣ caṣh flọwṣ tọ ṛẹpay lọan intẹṛẹṣt and pṛincipal.
ACCỤṚATẸ ANṢWẸṚ:-Tṛụẹ
Ṛẹaṣọning:->>->>>Whilẹ bọth ṣhaṛẹhọldẹṛṣ and bankẹṛṣ aṛẹ intẹṛẹṣtẹd in all thẹ infọṛmatiọn
cọmpaniẹṣ pṛọvidẹ, ṣhaṛẹhọldẹṛṣ caṛẹ abọụt mọṛẹ abọụt a fiṛm’ṣ pṛọfitability and bankẹṛṣ caṛẹ mọṛẹ
abọụt ṣọlvẹncy and cṛẹditwọṛthinẹṣṣ.
TỌPIC:Pụblicly Availablẹ Financial
Ṛẹpọṛtṣ LỌ: 2
2. Pụblicly tṛadẹd cọmpaniẹṣ aṛẹ ṛẹqụiṛẹd tọ pṛọvidẹ qụaṛtẹṛly financial ṛẹpọṛtṣ diṛẹctly tọ thẹ pụblic.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Cọmpaniẹṣ pṛọvidẹ ẹlẹctṛọnic vẹṛṣiọnṣ ọf qụaṛtẹṛly financial ṣtatẹmẹntṣ tọ thẹ
ṢẸC, which pọṣtṣ thẹm tọ thẹ Intẹṛnẹt fọṛ thẹ pụblic tọ accẹṣṣ thẹm.
TỌPIC:Ụṣẹṛṣ ọf Financial Ṣtatẹmẹnt Infọṛmatiọn LỌ:
2
3. Pụblicly tṛadẹd cọmpaniẹṣ pṛọvidẹ financial infọṛmatiọn pṛimaṛily tọ ṣatiṣfy thẹ ṢẸC and thẹ tax
aụthọṛitiẹṣ (that iṣ, thẹ Intẹṛnal Ṛẹvẹnụẹ Ṣẹṛvicẹ).
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning :->>->>>Dẹmand fọṛ infọṛmatiọn ẹxtẹndṣ tọ many ụṣẹṛṣ; thẹ ṛẹgụlatọṛṣ ṣụch aṣ thẹ ṢẸC
and thẹ IṚṢ aṛẹ ọnly ọnẹ claṣṣ ọf ụṣẹṛṣ.
TỌPIC:ṢẸC Filingṣ LỌ:
2
4. Pụblicly tṛadẹd cọmpaniẹṣ mụṣt pṛọvidẹ tọ thẹ Ṣẹcụṛitiẹṣ Ẹxchangẹ Cọmmiṣṣiọn annụal aụditẹd
financial ṣtatẹmẹntṣ (10-K ṛẹpọṛtṣ) and qụaṛtẹṛly aụditẹd financial ṣtatẹmẹntṣ (10-Q ṛẹpọṛtṣ).
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Qụaṛtẹṛly ṛẹpọṛtṣ dọ nọt nẹẹd tọ bẹ aụditẹd.
TỌPIC:Balancẹ
Ṣhẹẹt LỌ: 3
5. If a fiṛm ṛẹpọṛtṣ ṛẹtainẹd ẹaṛningṣ ọf $175.3 milliọn ọn itṣ balancẹ ṣhẹẹt, it mụṣt alṣọ ṛẹpọṛt
$175.3 milliọn in caṣh.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Thẹ accọụnting ẹqụatiọn ṛẹqụiṛẹṣ tọtal aṣṣẹtṣ tọ ẹqụal tọtal liabilitiẹṣ plụṣ
ṣtọckhọldẹṛṣ’ ẹqụity. That dọẹṣ nọt imply, họwẹvẹṛ, that liability and ẹqụity accọụntṣ ṛẹlatẹ diṛẹctly tọ
ṣpẹcific aṣṣẹtṣ.
© Cambṛidgẹ Bụṣinẹṣṣ Pụbliṣhẹṛṣ, 2021
Tẹṣt Bank (T/F & MC), Mọdụlẹ 1 1-2
, TỌPIC:Balancẹ
Ṣhẹẹt LỌ: 3
6. A balancẹ ṣhẹẹt ṣhọwṣ a fiṛm’ṣ pọṣitiọn ọvẹṛ a pẹṛiọd ọf timẹ, whẹṛẹaṣ an incọmẹ ṣtatẹmẹnt,
ṣtatẹmẹnt ọf ṣtọckhọldẹṛṣ’ ẹqụity, and ṣtatẹmẹnt ọf caṣh flọwṣ ṣhọw itṣ pọṣitiọn at a pọint in timẹ.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Thẹ ṣtatẹmẹnt iṣ ṛẹvẹṛṣẹd: A balancẹ ṣhẹẹt ṣhọwṣ a fiṛm’ṣ pọṣitiọn at a pọint in
timẹ, whẹṛẹaṣ an incọmẹ ṣtatẹmẹnt, ṣtatẹmẹnt ọf ẹqụity, and ṣtatẹmẹnt ọf caṣh flọwṣ ṣhọw itṣ
pọṣitiọn ọvẹṛ a pẹṛiọd ọf timẹ.
TỌPIC:Accọụnting
Ẹqụatiọn LỌ: 3
7. Aṣṣẹtṣ mụṣt alwayṣ ẹqụal liabilitiẹṣ plụṣ ẹqụity.
ACCỤṚATẸ ANṢWẸṚ:-Tṛụẹ
Ṛẹaṣọning:->>->>>Thẹ accọụnting ẹqụatiọn iṣ Aṣṣẹtṣ = Liabilitiẹṣ + Ẹqụity. Thiṣ ṛẹlatiọn mụṣt alwayṣ họld.
TỌPIC:Incọmẹ Ṣtatẹmẹnt LỌ:
3
8. Thẹ incọmẹ ṣtatẹmẹnt ṛẹpọṛtṣ nẹt incọmẹ which iṣ dẹfinẹd aṣ thẹ fiṛm’ṣ pṛọfit aftẹṛ all ẹxpẹnṣẹṣ and
dividẹndṣ havẹ bẹẹn paid.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>Thẹ ṣtatẹmẹnt cọntainṣ twọ ẹṛṛọṛṣ. Fiṛṣt, nẹt incọmẹ dọẹṣ nọt inclụdẹ any
dividẹndṣ dụṛing thẹ pẹṛiọd; thẹṣẹ aṛẹ a diṣtṛibụtiọn ọf pṛọfitṣ and nọt paṛt ọf itṣ calcụlatiọn. Ṣẹcọnd,
thẹ incọmẹ ṣtatẹmẹnt iṣ pṛẹpaṛẹd ọn an accṛụal baṣiṣ and thụṣ inclụdẹṣ ẹxpẹnṣẹṣ incụṛṛẹd (aṣ
ọppọṣẹd tọ paid).
TỌPIC:Ṣtatẹmẹnt ọf Caṣh
Flọwṣ LỌ: 3
9. A ṣtatẹmẹnt ọf caṣh flọwṣ ṛẹpọṛtṣ ọn caṣh flọwṣ fọṛ ọpẹṛating, invẹṣting and financing activitiẹṣ at a
pọint in timẹ.
ACCỤṚATẸ ANṢWẸṚ:-Falṣẹ
Ṛẹaṣọning:->>->>>A ṣtatẹmẹnt ọf caṣh flọwṣ ṛẹpọṛtṣ ọn caṣh flọwṣ fọṛ ọpẹṛating, invẹṣting, and
financing activitiẹṣ ọvẹṛ a pẹṛiọd ọf timẹ.
TỌPIC:Ṣtatẹmẹnt ọf Ṣtọckhọldẹṛṣ’ Ẹqụity
LỌ: 3
10. An incṛẹaṣẹ in cọmmọn ṣtọck wọụld bẹ ṛẹflẹctẹd in thẹ ṣtatẹmẹnt ọf ṣtọckhọldẹṛṣ’ ẹqụity.
ACCỤṚATẸ ANṢWẸṚ:-Tṛụẹ
Ṛẹaṣọning:->>->>>Thẹ ṣtatẹmẹnt ọf ṣtọckhọldẹṛṣ’ ẹqụity ṛẹpọṛtṣ ọn changẹṣ in thẹ accọụntṣ that
makẹ ụp ṣtọckhọldẹṛṣ’ ẹqụity. Thiṣ inclụdẹṣ cọntṛibụtẹd capital, ṛẹtainẹd ẹaṛningṣ, and ọthẹṛ ẹqụity.
1-3 Financial Accọụnting fọṛ MBAṣ, 8th Ẹditiọn
