Accounting: The Language of Business

In this course, students acquire knowledge of and insights into the most important (financial) decisions taken by management of companies. This accounting course contains an introduction to financial accounting and managerial accounting. Financial accounting explains the purpose of the balance sheet, income statement, statement of changes in shareholder equity, and the cash flow statement and their mutual relationships. It further explains the basic accounting rules that govern the preparation of these statements under IFRS. In addition, the course discusses and analyzes the effects of accounting choices on the value of the firm and the reported profits. The course also helps students to develop skills for financial statement analysis, which is important for stakeholders’ decision making. The course also shortly introduces the assurance services provided by the auditor. Decision making in the context of the managerial accounting be divided into two categories: (1) the collection and understanding of the information (cost accounting) and (2) the use of the information for decision making and reviewing the outcomes of the decisions (management accounting). In the cost accounting part, the course focuses on how to determine the cost of a product or service for which a firm needs to make a decision. The management accounting part focuses on the understanding the key concepts of economics and finance and how managers use cost accounting data in the light of these concepts in decision making process. Examples of topics covered include cost-volume profit analysis and make or buy decision etc. This course will also focus on the tool and techniques that are used to compare the actual outcomes of a decision with the expected outcomes with a view to evaluate managers’ performance. The course endeavors to apply the theoretical knowledge in the most relevant settings hence for selected topics students will work in small groups and apply the knowledge gained to real world business cases.