3
Grading
Assignment % of grade
Mid-term 1 30%
Mid-term 2 30%
Homework, including cases
15%
BIP 260 Group Project 25%
Total 100%
4
Grading
Final weighted score
Grade
93+ A
90-92.99 A-
87-89.99 B+
83-86.99 B
80-82.99 B-
77-79.99 C+
73-76.99 C
70-72.99 C-
60-69.99 D
Below 60 F
If you are on the border of a grade, being a good course contributor (participation, attendance, timeliness) may help.
6
Classroom information
Be engaged for the full class Be here on time Please don’t walk in and out of class Attendance taken – sign in as you arrive No computers Use your name plate Active learning – be prepared to think in class
7
Advice from former students
Make sure you know how to use to Excel. It really helps you organize your ratios and helps with the calculations.”
“To do well you need to do the practice problems”
“Take the time to really understand the concepts because this information is so relevant to every aspect of business and you will most likely have few other opportunities at NU to obtain this type of business sense.”
“Take good notes in class! This is key to prepare for the exams.”
8
This course is about
Getting you ready for the real world
Increasing your financial literacy
Becoming familiar and comfortable with the income statement and balance sheet
Understanding what the financial statements do NOT tell you
Learning to use financial information to make decisions
9
This course is not
Meant to turn you into an accountant
About obscure accounting rules
About how to fill out tax forms
Only for people going into business organizations
10
BIP Project
Pull together all your learning in this class
Makes you stand out in interview process
Prepares you for career
11
BIP Project
Four or five students on a team Analyze a US based company TAs will help you get needed info Wednesday Use discussion board to post company selection Compare company to a competitor Everyone works on all sections Confidential peer evaluations Carefully review project description
Important TA SESSION Wednesday
13
Online homework assignments and extra practiceHints to help you solve problemsCheck your work as you goGreat way to learn and prepare for examsFigure out what you need to study
PLEASE do not just guess! Use this as an opportunity to learn
14
If you forget to submit by 11:59 am (one minute before noon) on due date, the system will submit whatever is done by that time.
15
Accounting requires practice
Practice sets on Connect
“Like Homework” sets on Connect
Book Website : www.mhhe.com/marshall10e
Answers to odd number problems in book
Practice quizzes
Additional study resources
Multiple Choice and Matching at end of chapter in book – see suggested items under Practice Resources on Canvas
Robin and the TAs
16
Why Accounting?
Business Business success measured based on
it
Language of business
Tells you how to improve your business
You will need to negotiate with the finance people
Use information from financial statements to make decisions
Your bonus might depend on it
Not For Profit Build plans for organization
Language of organizations
Find ways to save money
You will need to negotiate with the finance people
Understand your donors
20
Who uses accounting information?
User Decision/Informed Judgment MadeManagement Planning, directing and controllingInvestors/Shareholders Assessing amounts, timing, and
uncertainty of future cash returns on their investment
Creditors/Suppliers Assessing probability of collection and the risk of late (or non-) payment
Employees Planning for retirement and future job prospects
Securities and Exchange Commission
Reviewing for compliance of all required information
21
Financial Accounting
The preparation and reporting of financial statements for an entity. External orientation
Historical results
22
Managerial Accounting
The use of economic and financial information to plan and control many of the activities of the entity and to support the management decision-making process.
23
Auditing
Public accounting firms and individual Certified Public Accountants (CPAs) provide auditing services and issue an independent auditor’s report.
25
History of Accounting
3000 B.C. 1494 1800’s 1900’s
Tax receipts on clay tablets
Double entry bookkeeping
Industrial Revolution
“Organized” Accounting
1929
Stock Market Crash
261929 Stock Market CrashFew Accounting Rules
• Crash provoked concern about financial disclosure
• Some alleged crash was due to inadequate financial information
• Securities Act of 1933 designed to protect investors from abuses in financial reporting and regulate initial offering and sale of securities in interstate commerce
27Securities and Exchange Commission (SEC)
Securities Exchange Act of 1934Regulates secondary market and national exchangesSEC was created by this Act
SEC has the authority to determine GAAP (generally accepted accounting principles)
Regulation S-X describes disclosure requirements
28
History of Accounting
The Committee on Accounting Procedure
1933&
1934
1939to
1959
FASB
19731929
Stock Market Crash
SEC
2002
The Sarbanes-Oxley Act
Enron, WorldCom, etc.
2009
FASB Codification
29Public Company Accounting Oversight Board
Created by the Sarbanes-Oxley Act
An arm of the SEC
5 members: 2 CPAs, 3 non-CPAs
Promulgates auditing standards for companies subject to the Sarbanes-Oxley Act◦ AICPA still issues auditing standards for non-public companies
CEOs and CFOs must certify financial statement disclosures
Section 404 requires companies to document adequate internal controls and procedures
31
Concept Statement (SFAC) #8
Objective of financial reporting: to provide financial information about the reporting entity that is useful to existing and potential investors, lenders and other creditors in making decisions about providing resources.
Information is provided about the economic resources, obligations, net resources and performance of an organization during a period of time.
Financial statement users need information to help them assess the prospects for future net cash inflows of the entity.
General purpose financial reports do not and cannot provide all of the information that stakeholders need.
General purpose financial reports are not designed to show the value of the reporting entity, but they provide information which will help the use estimate the value.
32
International Standards
The goal of the International Accounting Standards Board (IASB) is to develop a single set of high-quality, understandable, enforceable and globally accepted financial reporting standards based upon clearly articulated principles.
The FASB and the IASB have been working together to achieve convergence
The SEC is not likely to require international standards