1) Define accounting in your own words.
Accounting is the process of documenting, compiling, and analyzing financial information and
transactions. It enables people, companies, and organizations to maintain tabs on their financial
operations, evaluate their financial situation, and come to wise decisions.
2) “Accounting is called an Information System”- How? Briefly explain.
Due to the fact that accounting involves the gathering, processing, storing, and communicating of
financial data, it is referred to as an information system. It records economic activity, categorizes and
condenses it, and stores the data in records. In order to develop financial reports and provide
stakeholders with the information they need to make decisions , this data is then retrieved for analysis.
Accounting serves as a crucial information system for firms and makes it possible to effectively
communicate financial data to diverse stakeholders by acting as an organized framework for handling
financial information.
Think of accounting as a process that transforms unprocessed financial data into useful knowledge that
can be understood and investigated. It serves as a translator, transforming data and transactions into
understandable insights about the financial performance and status of an individual or firm. Making
informed judgments and effectively managing financial resources depend on this data.
3) Why accounting is called the ‘language of business’?
The reason accounting is referred to as the "language of business" is because it offers a standardized and
widely recognized system for expressing financial information. It gathers and documents financial
transactions, presents them in financial statements, and makes analysis and decision-making easier.
Accounting acts as a common language that enables firms to communicate their financial health and
performance to internal stakeholders like managers and external parties like investors and creditors. It is
a crucial tool for comprehending and assessing the financial elements of a corporation since it allows for
efficient communication, transparency, and comparison of financial information across various entities.
4) Why is accounting for EEE discipline?
Due to the following factors, accounting is important for the field of Electrical and Electronics
Engineering (EEE):
1. EEE projects require financial resources, and accounting enables engineers to manage project costs,
budgets, and resource allocation efficiently.
2. Accounting methods allow engineers to calculate and monitor project costs, assisting in decisionmaking and cost-cutting initiatives.
3. To assess the financial viability and possible return on investment of EEE projects, accounting offers
techniques like capital budgeting.
4.Accounting supports accurate and transparent reporting of project expenses, revenues, and financial
performance. EEE projects frequently call for financial reporting.
5.Accounting information, such as financial statements, helps evaluate project profitability, cost
efficiency, and identify areas for improvement.
5)Distinguish between financial and managerial accounting
Ans in SLIDE.
6) Distinguish between International Accounting Standards (IAS) and International Financial Reporting
Standards (IFRS) with examples.
International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) are two
sets of accounting standards developed by the International Accounting Standards Board (IASB). Here's a
brief description of their differences:
1. Scope:
- IAS: IAS refers to the original set of accounting standards developed by the International Accounting
Standards Committee (IASC). They were issued until 2001 and have been largely superseded by IFRS.
- IFRS: IFRS represents the current globally accepted accounting standards issued by the IASB. They are
continually updated and have been widely adopted by many countries worldwide.
2. Development:
- IAS: IAS were developed by the IASC and formed the foundation for the subsequent development of
IFRS.
- IFRS: IFRS is the result of the ongoing standard-setting process by the IASB, which builds upon the
previously issued IAS.
3. Numbering:
- IAS: IAS standards have their own individual numbering system, such as IAS 16 for Property, Plant, and
Equipment.
- IFRS: IFRS standards also have their own individual numbering system, such as IFRS 15 for Revenue
from Contracts with Customers.
4. Adoption:
- IAS: Some countries still use IAS as their national accounting standards if they have not fully adopted
IFRS. These countries may modify or supplement the IAS to suit their specific needs.
- IFRS: IFRS has been widely adopted as the required accounting framework for financial reporting by
many countries around the world.
5. Examples:
- IAS: Examples of IAS include IAS 1 Presentation of Financial Statements, IAS 2 Inventories, and IAS 10
Events after the Reporting Period.
- IFRS: Examples of IFRS include IFRS 9 Financial Instruments, IFRS 15 Revenue from Contracts with
Customers, and IFRS 16 Leases.
7) “All resources are depreciated, but human resources are appreciated” – Do you agree with this
statement? Motivate your answer with justification.
I agree with this statement and the statement "All resources are depreciated, but human resources are
appreciated" suggests that while physical resources undergo depreciation, human resources are valued
and recognized. Here's a brief analysis:
1. Depreciation of Physical Resources: Physical resources such as machinery, equipment, and buildings
are subject to depreciation. Depreciation is an accounting concept that recognizes the decline in value of
these assets over time due to factors like wear and tear, obsolescence, or usage.
2. Appreciation of Human Resources: The statement highlights that human resources are appreciated.
Human resources refer to the skills, knowledge, and abilities of individuals. Unlike physical resources,
human resources have the potential to grow, develop, and contribute to an organization's success.
Appreciation in this context refers to recognizing and valuing the contributions, abilities, and potential of
individuals within an organization.
Justification: The statement emphasizes the contrasting treatment of physical resources and human
resources. While physical resources tend to depreciate in value, human resources have the potential to
appreciate and grow in value with investment, development, and recognition. Organizations that
appreciate their employees often foster a positive work culture, job satisfaction, and employee loyalty,
which can lead to increased motivation and better performance. Recognizing and nurturing human
resources can result in positive outcomes for both individuals and organizations.
It's important to note that the statement simplifies a complex relationship. While physical resources may
depreciate, the value and potential of human resources can appreciate over time. Appreciating and
investing in human resources can contribute to long-term success and sustainability for organizations.
8)Briefly explain: Forensic accounting, HR accounting, Environmental accounting.
1. Forensic Accounting: Forensic accounting entails the use of accounting and investigation abilities to
find and examine financial fraud or other wrongdoing. It focuses on identifying and preventing financial
crimes, offering proof in court, and aiding in the settlement of financial disputes.
2. HR Accounting: The process of calculating and evaluating the worth of an organization's human
resources is known as HR Accounting. It analyses the influence of human resource management
methods on the financial performance of the firm as well as the costs and advantages of hiring, training,
and retaining staff.
3. Environmental accounting entails incorporating environmental costs and benefits into financial
reporting for a business. It measures the environmental effects of an organization's operations, such as
resource use and pollution, and aids in evaluating sustainability initiatives, fulfilling legal obligations, and
making wise decisions.
9) Write short note on: GAAP, FASB, ICAB, ICMAB, ARI
1. GAAP (Generally Accepted Accounting Principles): GAAP is the name of a collection of rules and
accounting principles that are applied to financial reporting to ensure uniformity and comparability. It
gives financial statement preparation and presentation a uniform structure.
2. FASB (Financial Accounting Standards Board): In the United States, FASB is an independent institution
that develops and enhances GAAP. It creates and releases accounting standards, guaranteeing that
investors, lenders, and other stakeholders receive usable financial information.
3. ICAB (Institute of Chartered Accountants of Bangladesh): ICAB is Bangladesh's regulatory authority for
professionals in accounting. It controls the accounting industry, establishes moral and professional
requirements, holds exams, and makes sure Bangladesh's chartered accountants are competent and
honest.
4. ICMAB (Institute of Cost and Management Accountants of Bangladesh): ICMAB is a professional
accounting body with a cost and management accounting specialty in Bangladesh. It establishes
standards, controls the management accounting profession, offers education and training, and
encourages best practices.
5. The Malaysian organization ARI (Accounting Research Institute) carries out accounting research,
fosters knowledge-sharing, and offers training. In order to improve accounting practices, standards, and
professional development in Malaysia, it works with academic institutions, businesses, and regulatory
organizations.
10) Briefly explain: Chart of Accounts, Accounting Cycle, Journal, Ledger, Trial Balance
1. Chart of Accounts: The Chart of Accounts is a structured list of all the accounts used in a company's
financial records. It categorizes accounts into assets, liabilities, equity, revenues, and expenses, providing
a framework for organizing financial transactions.
2. Accounting Cycle: The Accounting Cycle is a sequence of steps followed in the accounting process. It
includes identifying, analyzing, recording, and summarizing financial transactions. The cycle ensures
accurate financial reporting and involves activities like journalizing, posting to the ledger, preparing
financial statements, and closing the books.
3. Journal: A Journal is a chronological record of financial transactions. It captures transaction details
such as date, description, and amounts. Journals serve as the initial entry point, providing an audit trail
and supporting the accuracy of financial records.
4. Ledger: A Ledger is a collection of accounts that stores detailed transactional information. It contains
separate sections for each account, recording debits and credits. Ledgers provide a comprehensive view
of account balances and facilitate financial analysis and reporting.
5. Trial Balance: A Trial Balance is a list of all accounts and their balances at a specific time. It ensures the
equality of total debits and credits. The Trial Balance aids in identifying errors before preparing financial
statements and helps maintain the accuracy of accounting records.