Account/s, accounting, accountant, accountancy

 

1. An _____ is an element in an _____ system.
2. _____ is a process of measuring and recording financial activity.
3. The _____ should design the _____ system.
4. _____ is a language of business.
5. An _____ is concerned with interpretation of financial information.
6. _____ is a service activity.
7. Asset _____ include cash.
8. ______is a fast growing profession.
9. _____ contains elements both of science and art.
10. A separate _____ is kept for each asset.
11. Many people confuse _______ and bookkeeping.
12. _______ is a service activity.
13. An_____ provides and interprets financial information.
14. _______ as a profession is very important.

 

UNIT 8

1. Memorize the following words and word-combinations:

 

statement of owner’s equity - отчет о капитале компании, звіт о

                                                 капіталі підприємства                                               

statement of cash flow         - отчет о движении ликвидности, звіт

                                                 про переміщення готівки       

statement of financial position - отчет о финансовом состоянии, звіт про

                                                 фінансове положення

to list                                    - перечислять, перелічувати

net income                           - чистая прибыль/доход, чистий

                                                 прибуток

to exceed                             - превосходить, перевищувати

net loss                                -  чистые затраты/убытки, чистий збиток,

                                                чисті витрати

withdrawal                          - изъятие, брати назад

to exclude                            - исключать, виключати  

depreciation                         - обесценение, знецінювання, зниження

                                                 вартості

 

2. Read and translate the text:

 

BUSINESS DOCUMENTS

 

      The analysis of the transactions complete, what is the next step in the accounting process? How does an accountant present the results of the analysis? We now look at the financial statements. These business documents report financial information about the entity to persons and organizations outside the business.

      The primary financial statements are the (I) balance sheet, (2) in­come statement, (3) statement of owner's equity, and (4) statement of cash flow.

     The balance sheet lists all the assets, liabilities, and owner's equity at a point in time, usually the end of a month or a year. The balance sheet is like a snapshot of the entity. For this reason, it is also called the state­ment of financial position. A balance sheet is made up of two lists, placed side by side. On the left the company lists everything it owns, such as cash and 'fixed assets' called property, plant, equipment, which includeeverything from buildings and trucks to tools, pencils, and copy ma­chines. This list is labelled assets. On the other side, the company lists its liabilities, consisting of all the claims to the company's assets, from creditors and from the company owners.

    The income statement, or profit and loss statement (P&L) meas­ures the performance of an enterprise. It presents a summary of the revenues and expenses of an entity for a specific period of time, such as a month or a year. The income statement, also called the statement of operations, is like a moving picture of the entity's operations during the period. The income statement holds perhaps the most important single piece of information about a business—its net income, which is reve­nues minus expenses. If expenses exceed revenues, the result is a net loss for the period.

     The statement of owner's equity presents a summary of the chang­es that occurred in the owner's equity of the entity during a specific time period, such as a month or a year. Increases in owner's equity arise from investments by the owner and net income earned during the peri­od. Decreases result from withdrawals by the owner and from a net loss for the period. Net income or net loss comes directly from the income statement. Investments and withdrawals by the owner are capital trans­actions between the business and its owner, so they do not affect the income statement.

       Another tool for understanding a company's activity is to look at its cash flow. This measures the actual flow of funds - real money - flowing into and out of a company during a given period of time. A company's cash flow factors out all of the accounting tricks and looks at what a company really earned, because it excludes accounting tools such as depreciation.

 

3.Make up questions to which the following are the answers:

 

1. Financial statements report financial information.
2. They use primary financial statements
3. The balance sheet is like a snapshot.
4. This list is labeled “assets”.
5. This.list is labeled “liability”.
6. The income statement does.
7. It is revenues mines expenses.
8. Decreases result from withdrawals by the owner.

 

4.Complete the following statements:

 

1. Financial statements report _____.
2. The primary financial statements are _____.
3. The balance sheet is like _____.
4. The income statement measures _____.
5. The statement of owner’s equity presents _____.
6. Cash flow measures _____.
7. Net income comes _____.
8. Net lose comes _____.
9. Investments are _____.

 

5.Match the terms and their definitions:

 

1. statement          a. that which is owed by an organization;

2. equity               b. something of value to an organization;                         

3. balance sheet    с. all things owned by a business that have money

4. income                  value;   

5. profit                d. the debts owed by a business to its creditors and 

6. liability                 to its owners;

7. revenue            e. a statement showing the financial position of a

8. fund                      business to a certain date;     

9. asset                 f. the amount by which the price received for goods      

10. fixed asset            is greater than the costs;

                             g. resources used to support activities;

                             h. money that you receive from investments;

                             i. an increase in owner’s equity resulting from

                                  transactions;            

                             j. a written report about business activity

 

6.Speak about: Balance sheet

                    Profit and loss statement

                    Statement of owner's equity  

 

UNIT 9

1. Memorize the following words and word-combinations:

cash account                         - наличный счет, готівковий рахунок

effect                                    - влияние, вплив               

medium of exchange             - средство обмена, засіб обміну                     

face value                             - номинальная стоимость, номінальна

                                                вартість 

money order                         - платежное поручение, платіжне

                                                доручення       

notes receivable account       - счет полученных векселей, рахунок

                                                векселів отриманих                           

promissory note                    - вексель, вексель             

pledge                                  - обязательство, забов’язання             

prepaid expenses                  - заранее оплаченные расходы,

                                                 попередньо сплачені витрати       

2. Read and translate the text:

TYPES OF ACCOUNT

 

  This text gives you more information about different kinds of ac­counts. Assets. Assets are rights to use resources that are expected to result in future economic benefit for the accounting entity.

Cash. The cash account shows the cash effects of business transactions. Cash means money and any medium of exchange that a bank accepts at face value. Cash includes currency, coins, money or­ders, certificates of deposit, and checks. The cash account includes these items whether they are kept on hand, in a safe, in acash register, or in a bank.

Notes Receivable. A business may sell its goods or services in exchange for a promissory note, which is a written pledge that the cus­tomer will pay the business a fixed amount of money by a certain date. The notes receivable account is a record of the promissory notes that the business expects to collect in cash.

Accounts Receivable. A business may sell its goods or services in exchange for an oral or implied promise for future cash receipt. Such sales are made on credit (on account). The accounts receivable account in­cludes these amounts.

Prepaid Expenses. A business often pays certain expenses in ad­vance. Pre-paid expenses are assets because they will be of future benefit to the business. The ledger holds a separate asset account for each prepaid item. Prepaid rent and prepaid insurance are prepaid ex­penses that occur often in business. Office supplies are also accounted for as prepaid expenses.

 

3.Answer the questions:

1. What is an asset?
2. What is cash account?
3. What are notes receivable?
4. What are accounts receivable?
5. What are prepaid expenses?

 

4.Complete the following statements:

1. Cash means______.
2. Cash account includes_______.
3. Promissory note is ______.
4. The accounts receivable account includes _____.
5. Office supplies are accounted for as______.

 

5.Match the terms and their definitions:

1.Expenses                  a. Documents in which a person promises to pay

                                      a fixed sum of money on demand.

2.Transactions             b. Amounts owed to a business by suppliers of                   

                                      goods and services.

3.Accounts receivable c. The cost of assets consumed in the process

                                       of earning revenue.           

4.Promissory notes         d.The economic events of the enterprise recorded

                                       by accountants. 

        

UNIT 10

1. Memorize the following words and word-combinations:

to recall           - напоминать, нагадувати   

notes payable   - выданный вексель, вексель виданий        

account payable - кредиторская задолженность, кредиторська

                            заборгованість              

to imply           - предполагать; мати на увазі, припускати                         

to split             - разбивать, розбивати              

remainder        - остаток, залишок     

to merge            - соединять, з’єднувати    

2. Read and translate the text:

TYPES OF ACCOUNT

(continuation)

 

Liabilities. Recall that a liability is a debt. A business generally has fewer liability accounts than asset accounts because a business' liabili­ties can be summarized under relatively few categories.

Notes Payable. This account is the opposite of the Notes Receiva­ble account. Notes Payable records the amounts that the business must pay because it signed a promissory note to purchase goods or services.

Accounts Payable. This account is the opposite of the Accounts Receivable account. The oral or implied promise to pay off debts arising from credit purchases of goods appears in the Accounts Payable ac­count. Such a purchase is said to be made on account. Other liability categories and accounts are added as needed. Taxes Payable, Wages Payable, and Salary Payable are accounts that appear in many ledgers. Some other accounts may be as follows:

ü Owner's Equity. The claim that the owner has on the assets of the business is called owner's equity. In a proprietorship or a partnership, owner's equity is often split into separate accounts for the owner's capi­tal balance and the owner's withdrawals.

ü Capital. This account shows the owner's claim to the assets of the business. After total liabilities are subtracted from total assets, the remainder is the owner's capital. The balance of the capital ac­count equals the owner's investments in the business plus its net in­come and minus net losses and owner withdrawals. In addition to the capital account, the following accounts also appear in the owner's equity section of the ledger.

ü Withdrawals. When the owner withdraws cash or other assets from the business for personal use, its assets and its owner's equity both decrease. The amounts taken out of the business appear in a separate account entitled Withdrawals, or Drawing. If withdrawals were re­corded directly in the capital account, the amount of owner withdrawals would be merged with owner investments. To separate these two amounts for decision making, businesses use a separate account for Withdrawals. This account shows a decrease in owner's equity.

ü Revenues. The increase in owner's equity from delivering goods or services to customers or clients is called revenue. The ledger contains as many revenue accounts as needed. If the business loans money to an outsider, it will also need an Interest Revenue account. If the business rents a building to a tenant, it will need a Rent Revenue account. Increas­es in revenue accounts are increases in owner's equity.

ü Expenses. The cost of operating a business is called expense. Ex­penses have the opposite effect of revenues, so they decrease owner's equi­ty. A business needs a separate account for each category of its expenses, such as Salary Expense, Rent Expense, Advertising Expense, and Utili­ties Expense. Expense accounts are decreases in owner's equity.

 

3.Speak about: Accounts payable,

                     Capital,

                     Withdrawals,

                     Revenues,

                     Expenses.

 

Use the phrases: I should like to begin…,I’d like to emphasize that…, Generally speaking…, As to…, It proves that…, As a result….

4.Complete the following statements:

1. Notes payable account is opposite _____.
2. The claim that the owner has on the assets of the business is called_____.
3. Capital account shows _____.
4. The balance of capital account equals _____.
5. The increase in owner’s equity from delivering goods or services to customers____.
6. The cost of operating a business is called_____.

 

UNIT 1 1

1. Memorize the following words and word combinations:

 

auditing              -  аудит, аудит

to involve             - вовлекать, залучати

evaluation               - оценка, оцінка, визначення вартості               

financial record       - финансовый отчет, фінансовий звіт

irregularity              - отклонение от нормы, відхилення від норми                          

internal audit           - внутренний аудит, внутрішній аудит           

misappropriation     - растрата, незаконне привласнення, розтрата

to be consistent       - согласующийся, узгоджуватися  

installing                - установка, установлення   

operating procedures - методы работы, методи роботи      

fiscal affairs            - фискальные вопросы, фіскальні питання

deviation                - отклонение, відхилення                   

standard operating procedure – стандартная методика, стандартна         

                                 методика

to seek                   - стремиться, намагатися

sole                       - единственный, єдиний       

2. Read and translate the text:

 

AUDITING

 

     Auditing is an accounting function that involves the review and eval­uation of financial records. It is done by someone other than the per­son who entered the transactions in the records. Not so many years ago, the presence of an auditor suggested that a company was having finan­cial difficulties or that irregularities had been discovered in the records. Currently, however, outside audits are a normal and regular part of busi­ness practice. In addition, many corporations, especially the larger ones with complex operations, maintain a continuous internal audit by their own accounting departments.

     Even those companies that do not conduct an internal audit need to maintain a system of internal control. Most good systems will provide accounting controls against errors, as well as a division of duties to re­duce the possibility of misappropriations.

      Ideally, a business should use as many internal controls as are con­sistent with efficient operation. In practice, the cost of installing and maintaining control systems forces management to decide which con­trol devices to use. If there are too many controls, a time may come when the company's employees are spending more time filling out forms than performing productive work.

   As we noted above, many companies employ their own accountants to maintain an internal audit. They continuously review operating pro­cedures and financial records and report to management on the current state of the company's fiscal affairs. These accountants also report on any deviations from standard operating procedures; that is, the company's established methods for carrying on its operating and recording func­tions. The internal auditors also make suggestions to management for improvements in the standard operating procedures. Finally, they check the accounting records in regard to completeness and accuracy, making sure that all irregularities are corrected. Overall, the internal auditors seek to ensure that the various departments of the company follow the pol­icies and procedures established by management.

       The emphasis placed on different parts of the internal auditor's report varies from company to company. In some organizations, the auditor's major or even sole function is to report on the completeness and accu­racy of the books of account, as the financial records are known collec­tively. In more progressive companies, greater attention may be paid to the auditor's suggestions. In this case, instead of dealing primarily with the accounting and financial aspects of the business, the auditor also deals with operations such as marketing, production, and purchasing.

 

3.Answer the questions:

 

1. What is auditing?
2. What does auditing involve?
3. What does a presence of an auditor suggest?
4. What types of auditing are there?
5. How many internal controls should a business use?
6. What do internal auditors do?
7. What do internal auditors seek for?

 

4.Fill in blanks with missing words:

Audit auditor/s auditing

1. ______ is an accounting function.
2. The internal______ make suggestions to management.
3. An independent _____ examines a company’s records.
4. Let’s enumerate the major steps of the ______ process.
5. _______ is an analytical process.
6. The system and the data it produces are covered by the _____ process.
7. The_____ tests underlying accounting data.
8. One key justification for independent____ is the economy.
9. The local _____is cheaper.
10. ______can help the business set up a reliable accounting system.
11. Independent _____ is done by accountants who are not employees of the company.

                                 

5.Agree or disagree with the following, use the phrases: Absolutely, Perhaps, you are right…, Probably not…, That’s not exactly so…:

 

1. Auditing is done by any member of a staff.
2. Outside audits are normal part of business practice.
3. Companies need to maintain a system of internal control.
4. Companies employ only their own accountants to maintain an internal audit.
5. Greater attention may be paid to the auditor's suggestions.
6. The auditor deals with marketing, production, and purchasing.

UNIT 1 2

1. Memorize the following words and word combinations:

 

public accounting - государственный учет, державний облік    

refinement         - усовершенствование, удосконалення                        

designation        - обозначение, позначення  

compliance        - соответствие, відповідність

to comply with   - подчиняться, підпорядковуватися

conformity         - соответствие, відповідність

conduct             - проведение, проведення

to attain             - достигать, досягати                             

gauge                - мера, міра   

 

2. Read and translate the text:

AUDITING STANDARDS

In the early history of public accounting, the quality of audit examinations often varied widely, depending on the skill, understanding, and judgment of the particular audit involved. Even at this early stage in its development, the profession quickly recognized that standards were needed. Accordingly, the profession began drawing up a number of authoritative statements that have now undergone several decades of refinement and interpretation.

A set of “generally accepted auditing standards” – to use their official designation – was issued. It is essential that every auditor has a thorough understanding of these standards. The auditor’s report refers directly to generally accepted auditing standards. The lack of compliance with generally accepted auditing standards is a violation of the Code of Professional Conduct. Thus, in conducting an audit, an independent auditor must comply with generally accepted auditing standards. Independent auditing firms themselves must comply with generally accepted auditing standards in conducting an audit practice. Such conformity involves the establishment of quality control practices and procedures.

Note that there is a clear distinction between auditing standards and auditing procedures. The term procedures in auditing refers to the methods and techniques used by the auditor in the conduct of the examination. The audit procedures used will vary according to the particular circumstances of the individual audit examination. In contrast, auditing standards deal with measures of the quality of the auditor’s performance of the procedures and the objectives to be attained by the use of the procedures undertaken. Auditing standards rarely change, and then only by official decree. Generally accepted auditing standards are important for several reasons: they define the broad objectives for every independent audit; they provide a gauge for judging an auditor’s performance; and they are recognized throughout the business and legal world as the standards of the profession.

  Auditing standards are issued in the form of Statements on Auditing Standards (SASs). In most cases, each SAS covers a specific area or issue (e.g., internal control structure or analytical procedures). However, SASs can also represent several more technical issues combined into a single statement. In many cases, the actual procedures performed by an auditor exceeds the requirements of auditing standards.

There are 10 generally accepted auditing standards, which are developed into three broad categories: general standards, standards of audit work, and standards of reporting.

 

2. Answer the questions:

1. What are the auditing standards?
2. Why is it essential to have generally accepted auditing standards?
3. Are there any distinctions between auditing standards and procedures?
4. What does the term ‘procedures’ refer to?
5. How are auditing standards issued?

 

3.Complete the following statements:

1. _____ the quality of audit examinations often varied widely.
2. It is essential that every auditor has a ______.
3. The lack of compliance with generally accepted auditing standards _____.
4. The audit procedures _____.
5. Auditing standards deal with _____.
6. Auditing standards _____.
7. Generally accepted auditing standards are_____.

 

4.Fill in the missing prepositions: of (5), by, from, out

An auditor is an accountant, independent _____ accompany, who is appointed_____ the shareholders to ensure that the annual accounts give a true and fair view _____ the state _____the company. The accounts should be prepared using the accepted methods _____ accountancy. Auditors will also try to ensure that the organization’s accounting systems do not allow any fraud or stealing to occur_____ the company’s funds. Large organizations might carry _____ an internal audit themselves to ensure that their accounting practices and procedures are accurate and efficient.

 

UNIT 1 3

1. Memorize the following words and word-combinations:

operational audit - операционный аудит, операційний аудит

compliance audit - аудит согласования, аудит погодження

prescribed - предписанный, припис

compliance with - в соответствии с, у відповідності до

contractual agreement- контракт, контракт

assumption - предположение, припущення

2.Read and translate the text:

 

TYPES OF AUDIT

 

Three types of audit are the main ones: operational audits, com­pliance audits, and audits of financial statements.

Operational audits is a review of any part of an organization's operating procedure and methods for the purpose of evaluating efficiency and effectiveness. At the completion of an operational audit, recommen­dations to management for improving operations are normally expected. In operational auditing, the reviews are not limited to accounting. They can include the evaluation of organization structure, computer opera­tion, production methods, marketing, and any other area in which the auditor is qualified. In this sense, operational auditing is more similar to management consulting than to what is generally required as auditing.

Compliance audits. The purpose of the compliance audits is to determine whether the auditee is following specific procedures or rules set down by some higher authority. A compliance auditing could include determining whether accounting personnel are following prescribed pro­cedures, reviewing wage rates for compliance with minimum laws, or ex­amining contractual agreements with bankers and other lenders, etc.

Audits of financial statements. This type of auditing is conducted
to determine whether the overall financial statements are stated in

ac­cordance with specific criteria. The assumption underlying an audit of
financial statements is that they will be used by different groups for

dif­ferent purposes. Normally, the criteria are generally accepted accounting
principles.            

 

3.Speak about:  Types of audit;

                     Differences between three types of audit.

Use the phrases: To begin with…, I’ll consider…, Then I’ll concern myself with…, n conclusion….