UNIVERSITY OF THE EAST
COLLEGE OF BUSINESS ADMINISTRATION
Caloocan Campus
DEPARTMENT OF ACCOUNTANCY, BUSINESS LAW & TAXATION (ACLAT)
A.
B.
C.
D.
E.
SUBJECT CODE
COURSE TITLE
COURSE CREDIT
PRE-REQUISITE SUBJECT
COURSE DESCRIPTION
:
:
:
:
:
AC 206
FINANCIAL ACCOUNTING AND REPORTING, PART II
SIX (6) UNITS
AC 4 & 5 FINANCIAL ACCOUNTING AND REPORTING, PART I
This course is a continuation of Financial Accounting & Reporting Part I. It is designed to cover the financial
accounting principles relative to recognition, measurement, valuation, and financial statement presentation of
liabilities, shareholders’ equity, and special topics (leases, accounting for income taxes and employee benefits)
including disclosure requirements. The related internal control, ethical issues, and management of liabilities and
owner(s)’ equity are also covered. It also deals with contemporary issues such as leases, employee benefits,
and accounting for income taxes and other current related items.
F. COURSE OBJECTIVES
1.
GENERAL:
:
At the end of the course, the students should be able to:
1.1 Acquire knowledge on the latest pronouncements of the Framework for the Preparation and Presentation
of Financial statements and the Philippine Financial Reporting Standards PFRS) through the Philippine
Accounting Standards (PAS).
1.2 Acquire sufficient knowledge and familiarity with the updated PAS 1 / IAS 1: Presentation of Financial
Statements.
1.3 Acquire familiarity with the latest / updated PFRS on the preparation and presentation of the asset
accounts in the Statement of Financial Position.
1
1.4 Appreciate the significance of preparation and presentation of financial statements in adherence to the
latest PFRS in order to objectively serve the needs of the different financial information users or
stakeholders.
1.5 Show concern on the related internal control, ethical issues and the efficient and effective management of
assets/resources of the business enterprise.
1.6 Show commitment to the social and economic upliftment of business enterprises by adhering to the basic
concepts and principles of financial accounting in solving problem situation.
2.
SPECIFIC :
At the end of the course, the students should be able to:
2.1 COGNITIVE
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
2.1.6
2.1.7
Know and understand the concepts of the FRAMEWORK and the updated PASs on the asset
accounts of the Statement of financial Position.
Understand fully the FRAMEWORK and the PASs as they are applied in the discussion of the
different asset accounts.
Apply the accounting concepts in conformity with the FRAMEWORK and PASs
Analyze the applications of accounting concepts based on the FRAMEWORK and PASs
Prepare in classified form the financial statements in conformity with the FRAMEWORK and
PASs
Analyze and interpret the financial statements to ascertain the liquidity and profitability position of
the business enterprise.
Evaluate the significance of applying the FRAMEWORK and PASs in relation to the real business
environment.
2.2 AFFECTIVE
2.2.1
2.2.2
2.2.3
Appreciate the different features of FRAMEWORK and the updated PASs
Appreciate the values of the different asset accounts to the business enterprise to ensure and
efficient and effective operations and long-term viability.
Relate the topics discussed in the classroom with the actual situation in the business industry.
2.3 PSYCHOMOTOR
2
2.3.1
2.3.2
2.3.3
2.3.4
2.3.5
Apply the accounting concepts in conformity with the FRAMEWORK and updated PASs
Follow the accounting process as they are applied in the PFRS and in the textbook with the
FRAMEWORK and updated PASs
Perform the analytical task of recording transactions based on the FRAMEWORK and updated
PASs
Practice the art of using the accounting concepts in the preparation and presentation of financial
statements in properly classified format.
Carry out the knowledge learned in classroom discussions to the real business world.
G. COURSE REQUIREMENTS
1.
CLASS STANDING:
1.1 Recitation
1.2 Assignment
1.3 Group Report
Others:
1.4.1 Seat work
1.4.2 Attendance
1.4.3 Board work
2
MAJOR QUIZZES:
2.1
2.2
2.3
3
PRELIM
QUIZ NO. 1
QUIZ NO. 2
QUIZ NO. 3
:
2.4
2.5
2.6
MIDTERM
QUIZ NO. 4
QUIZ NO. 5
QUIZ NO. 6
2.7
2.8
2.9
FINALS
QUIZ NO. 7
QUIZ NO. 8
QUIZ NO. 9
PERIODIC DEPARTMENTAL EXAMINATIONS – PRELIM, MIDTERM AND FINALS
3.1
3.2
3.3
Prelim Departmental Examination
Midterm Departmental Examination
Final Departmental Examination
CLASSROOM DECORUM:
1. You are expected to be always in your prescribed uniform plus your University issued ID.
3
2. You are expected to attend the class on time and University Policy on attendance will be applied.
H. COURSE OUTLINE
:
WEEKS
TOPICS
Week
1 -3
1. Accounting for Intangible Assets
(PAS 38)/Impairment of Assets(PAS 36)
a. Definition, nature and classes
http://www.youtube.com/watch?v=0U0Ez_8UQw
(18 hrs)
b. Recognition criteria
c. Initial measurement
d. Accounting for intangibles (patents,
copyright, trademark, trade names,
franchise right, leasehold right,
computer software, goodwill, research
and development cost other
intangibles)
http://www.google.com.ph/imgres?imgurl
=http://images.bibliocad.com/biblioteca/i
mage/00020000/2000/logo-honda
READING /
ASSIGNMENTS
By: N. Robles / P.
Empleo
Chapter 6 Intangible
Assets
p. 340-389
By: Valix / Peralta / Valix
Chapter 25 Intangible
Assets
p. 1194 - 1132
ACTIVITIES
Lecture /
Discussion
EVALUATION
 Class Standing
 Board work
 Seatwork
 Graded
Recitation
 Quiz 1
e. Subsequently incurred costs
f. Measurement subsequent to initial
recognition (cost method, revaluation
method)
g. Amortization
h. Impairment of value of intangible
assets
i. Reversal of impairment loss
j. Retirement and disposition
k. Financial statement presentation and
disclosure
http://www.accountingtools.com/definitio
4
n-financial-statemen
l. Internal control measures for
intangibles
Week
4-6
18
hours
2.
Accounting for Trade & other Payables
2.1. Definition and composition
2.2. Recognition and measurement
of Financial and non-financial
Liabilities
http://www.accountingtools.com/di
ctionary-financial-liability
2.2.1. Financial liabilities with
definite amount
 Trade payables
 Short-term notes payable
 Commercial papers
http://www.bdo.com.ph/Per
sonal/DepositsInvestments/I
AS/CommercialPaper.asp
 Current portion of longterm debt
 Accrued expenses
3.2.2 Non-financial liabilities
 Unearned revenues
 Customer’s deposits
http://www.accountingtools.
com/questions-andanswers/what-is-acustomer-deposit.html
 Outstanding gift
certificates
 Deposits for returnable
containers
Framework-Recognition
and measurement of
Liabilities
IAS 1 - Current Liabilities
Chapter 1 – Current
Liabilities, Provisions and
contingencies p. 1 – 82
Intermediate Accounting
Vol. 2 2012 Edition
By PM Empleo and NS
Robles
Lecture /
Discussion
 Class Standing
 Board work
 Seatwork
 Graded
Recitation

Quiz 2 & 3
Chapter 1 Liabilities
p. 1- 63
Financial Accounting Vol
2 2012 Edition
By: CT Valix and JF
Peralta
Chapter 13 Accounting
for :Liabilities
p. 516 – 571
Fundamentals of
Intermediate Accounting
2008 Edition By: Lieso,
Fargher, Wise, Weygandt
and Warfield
5


2.3.
3.
WEEK 7
18 hrs.
3. Provisions, Contingent Assets, and
Contingent Liabilities(PAS 37)
3.1. Provisions and other liabilities
3.2. Contingent liabilities
3.3. Contingent assets
3.4. Financial statement presentation
and disclosures
PRELIM EXAMINATION WEEK
2. Administration of Prelim Examination
3. Evaluation of Prelim examination
4. Discussion of Prelim exam solution to students
5. Computation of prelim grades
6. Distribution of prelim grade to students
7. Checking of columnar lecture note book
WEEK/
HOURS
WEEK
9 -11
Bonuses
Unearned service
contracts
 Others
Financial statement presentation
and disclosure
TOPICS
4.
MIDTERM PERIOD
READING
ASSIGNMENTS
Non-current Liabilities(Bonds
Payable)/Government Grants (PAS 20)
4.1. Definition and composition
http://www.investorwords.com/521/bond.html
4.2. Recognition and measurement
4.3. Bonds payable
4.3.1. Issuance of bonds
 Interest and amortization of discount
and premium using straight-line and
ACTIVITIES
EVALUATION
Topic discussion
 Class
Standing
 Board work
 Seatwork
 Graded
Recitation
IAS 32 and 39
Chapter 2 Noncurrent liabilities p.
83 to 164
Intermediate
Accounting Vol. 2
2012 Edition
Internet search
group work
Samples of
different Bond
 Quiz 4
6
effective interest method
 Extinguishment of bonds- prior to
maturity; upon maturity, and
conversion into ordinary shares
 Financial statements presentation and
disclosures

By PM Empleo and
NS Robles
Indentures with
Appropriate
descriptions
Chapter 13
Accounting for
:Liabilities
p. 516 – 571
Fundamentals of
Intermediate
Accounting 2008
Edition By: Lieso,
Fargher, Wise,
Weygandt and
Warfield
Chapter 3 Bonds
Payable p. 98 to
187
Chapter 8 Notes
Payable and Debt
Restructure
p. 368 to 405
4.4.
5.
6.
7.
Long-term Notes Payable
4.4.1. Nature
4.4.2. Issuance of notes
 For cash –stated and market rate
 For assets or services
 Installment note issued for noncash
considerations
 Innovative mortgage notes
Note with an unrealistic interest rate
Special Topics
Shareholders’ Equity
7.1. Nature
7.2. Presentation on the Statement of
Financial Position
Topic discussion
Group work:
Submission of
sample actual
Lease Contracts
Chapter 3 –
Shareholders’ Equity
p. 172 – 296
Topic Discussion
 Class
Standing
 Board work
7
7.3.
7.4.
7.5.
7.6.
7.7.
7.8.
7.9.
7.10.
7.11.
7.12.
7.13.
7.14.
7.15.
7.16.
7.17.
7.18.
7.19.
Contributed Capital
Par and No – Par value shares
Ordinary and Preference shares
Equity Instruments under IAS 32
Authorized, Issued and Outstanding
shares
Issuance of Share Capital
7.8.1. Shares issued with other securities
7.8.2. share issue costs and stock
assessments
7.8.3. reacquisition of share capital
7.8.4. share split or stock split
7.8.5. stock rights, warrants and options
7.8.6. share appreciation rights
Retained Earnings
http://blog.accountingcoach.com/what-isretained-earnings/
Current profit or loss
allocation of cash dividends between
preference and ordinary shares
appropriation of retained earnings
correction of prior period error
cumulative effect of change in accounting
policy
quasi – reorganization
revaluation surplus
statement of changes in equity
book value per share
disclosure requirements
Intermediate
Accounting 2012
Edition by: PM
Empleo and NS
Robles
 Seatwork
 Graded
Recitation
 Quiz 5
 Quiz 6
8
WEEK
12
MIDTERM EXAMINATION WEEK
1. Administration of MIDTERM Examination
2. Evaluation of MIDTERM examination
3. Discussion of MIDTERM exam solution to students
4. Computation of MIDTERM grades
5. Distribution of MIDTERM grade to students
6. Checking of columnar lecture note book
FINAL GRADING PERIOD
WEEK/
READING /
TOPICS
HOURS
ASSIGNMENTS
Week
8.0. Leases(PAS 17)
Chapter 4 Leases
13-16
7.1. Nature and classification
p. 284-378
http://www.investorwords.com/27 Intermediate Accounting
49/lease.html
24
Vol. 2 2012 Edition
hours
7.1.1. Lessee’s viewpoint
By PM Empleo and NS
 Operating lease
Robles
 Capital / Finance lease
7.1.2. Lessor’s viewpoint
Chapter 4 Operating
 Operating lease
Lease and Leaseback
 Direct financing lease
p. 188-217; Chapter 5
 Sales-type lease
Finance Lease Lessee
 Sale of assets during
p. 218-263; Chapter 6
lease term
Finance lease Lessor p.
7.1.3. Sale-leaseback
264-301
transactions
Financial Accounting Vol
7.1.4. Leveraged lease
2 2012 Edition
7.1.5. Disclosure requirements By: CT Valix and JF
for lease
Peralta
IAS 17 Leases
9.0.
Income Taxes (PAS 12)
9.1. Nature of Income Tax
9.2. Current tax liabilities and
Chapter 5 Income Taxes
p. 399- 452
Intermediate Accounting
Vol. 2 2012 Edition
By PM Empleo and NS
ACTIVITIES
Topic Discussion
EVALUATION
 Class
Standing
 Board work
 Seatwork
 Graded
Recitation
 Quiz 7
Lecture / Discussion
 Class
Standing
 Board work
 Seatwork
 Graded
9
current tax assets
accounting income and taxable
income
9.4. deferred tax liabilities and
deferred tax assets
9.5. temporary differences
9.6. tax rate considerations
9.7. reversal of temporary
differences
9.8. computation of deferred tax
based on the difference
between the book basis and
the tax basis of assets and
liabilities
9.9. operating loss carry forwards
9.10. financial statement
presentation and classification
9.11. disclosure requirements
Robles
Recitation
9.3.
10.0. Employee Benefits(PAS 19) /
Retirement benefits(PAS 23)
http://www.ifrs.org/current-projects/iasbprojects/leases/Pages/leases.aspx
10.1.1.
Employee
benefits defined
10.1.2.
Recognition and
measurement
 Short-term employee
benefits
 Post-employment benefits:
nature of pension plans,
types of pension plans
(defined contribution
pension plans and defined
benefit pension plans)
 Termination benefits
 Quiz 8
 Class
Standing
 Board work
 Seatwork
 Graded
Recitation
 Quiz 9
Chapter 6 Employee
Benefits p. 433- 483
Intermediate Accounting
Vol. 2 2012 Edition
By PM Empleo and NS
Robles
Chapter 9 Employee
Benefits p. 406-498
Financial Accounting Vol
2 2012 Edition
10
 Equity compensation
benefits
 Pre-retirement
compensation plans
 Share-based compensation
plans – share award plans,
share option plans, share
appreciation rights, and
share purchase plans
WEEK
19
I.
By: CT Valix and JF
Peralta
IAS 19 Employee
Benefits
FINAL EXAMINATION WEEK
1. Administration of FINAL Examination
2. Evaluation of FINAL examination
3. Discussion of FINAL exam solution to students
4. Computation of FINAL grades
5. Distribution of FINAL grade to students
6. Checking of columnar lecture note book
7. Checking of Folder of accounting activities return to students
COURSE OUTLINE SUMMARY:
WEEK
1
2 and 3
4-5
6
7
8-9
10 -14
15
16 - 17
TOPICS / ACTIVITIES
Accounting for Impairment of Assets (PAS 36)
Accounting for Intangibles (PAS 38)
Accounting for Trade & Other Payables
Contingent Liabilities, Provisions, and Contingent Assets(PAS 37)
PRELIM EXAMINATION WEEK
Total
Accounting for Non-Current Liabilities(Bonds Payable)
Shareholders’ Equity
MIDTERM EXAMINATION WEEK
TOTAL NUMBER OF HOURS
Accounting for Leases (PAS 17)
LECTURE.
6 hrs.
12 hrs.
12 hrs.
6 hrs.
36 hrs.
12 hrs.
24 hrs.
36 hrs.
12 hrs.
11
18 - 19
20-21
J.
Accounting for Income Taxes
Accounting for Employee benefits(PAS 19)
TOTAL NUMBER OF HOURS
12 hrs.
12 hrs.
30 hrs.
PRESCRIBED TEXTBOOK:

P. M. EMPLEO and N. S. ROBLES (2012) Intermediate Accounting Vol. 2; Millennium Books, Inc., Manila
K. READING REFERENCES:
 Conrado T. Valix / Jose F. Peralta / Christian Aris M. Valix (2012) Financial Accounting Volume 2 GIC Enterprises and
Co., Inc
 Alfredson, Keith, L. Ken., R. Picker, P. Pacter, and J. Radford. (2005). Applying International Accounting Standards.
Australia: John Wiley and Sons, Ltd.
 Cabrera, E.B. Financial Accounting and Reporting, Theory and Practice Volume I, 2007 Edition, GIC Enterprises,
C.M. Recto, Manila
 Valencia, E. and G. Roxas (2004). Financial Accounting. Mandaluyong: Millennium Books, Inc.
L.
WEB – BASED LEARNING MATERIALS:
1. Understanding University Financial Statements & the Reconciliation Process, Accounting Coach
http://www.obfs.uillinois.edu
2. Liabilities and Stockholders’ Equity, (2011); Larry M. Walther, CPA and Christopher J. Skousen
http://www.ebooksdirectory.com/details.php?ebook=4078.
3. Principles of Accounting, (2011); Larry Walther, Ph.D., CPA, CMA
http://www.principlesofaccounting.com
M. GRADING SYSTEM:
PRELIM
Class Standing
Major Quizzes
Periodical Examination
10%
40%
50%
MIDTERM
Class Standing
Major Quizzes
Periodical Examination
10%
40%
50%
FINALS
Class Standing
Major Quizzes
Periodical Examination
PRELIM GRADE
100%
TENTATIVE MIDTERM
100%
TENTATIVE FINAL
10%
40%
50%
100%
12
(*PG)
GRADE(*TMG)
MIDTERM GRADE (*MG):
1/3 OF PG + 2/3 OF TMG = MG
*TMG – TENTATIVE MIDTERM GRADE
* MG - MIDTERM GRADE
*PG – PRELIM GRADE
GRADE EQUIVALENT DESCRIPTION
98 - 100 = 1.00 - Excellent
95 - 97 = 1.25 - Excellent
92 - 94 = 1.50 - Very Good
89 - 91 = 1.75 - Very Good
86 -
88
= 2.00
-
Good
83 -
85
= 2.25
-
Good
80
77
75
70
-
82
79
76
74
=
=
=
=
BELOW 70 =
2.50
2.75
3.00
4.00
GRADE(*TFG)
FINAL GRADE (*FG):
1/3 OF MG + 2/3 OF TFG = FG
*TFG -TENTATIVE FINAL GRADE
*FG - FINAL GRADE
-
5.00 -
Fair
Passed
Passed
Conditioned (for prelim and midterm
only)
Failed
Prepared by:
PROF. EMETERIA B. DALISAY
13