Financial reporting

Accountancy

Speaking part 2: long turn

Read Professional English in Use – Finance Unit 3, “Accounting and accountancy” before giving a one-minute talk on the following topic:-

Accounting

  • what accounting involves
  • how bookkeeping differs from accounting
  • financial and management accounting

Auditing

  • what auditors look for
  • the difference between external and internal auditing
  • the significance of a ‘true and fair view’

Laws, rules and standards

  • who sets accounting rules
  • who the accounts are prepared for in English-speaking countries
  • who the accounts are prepared for in continental Europe

Speaking part 3: discussion

A small, but expanding, business is considering employing an accountant. You have been asked to discuss whether this is possible or not.

Discussion points:

  • why the company might need an accountant
  • how the accountant’s role would differ from a bookkeeper’s
  • what qualifications they would need

Bookkeeping

Speaking part 2: long turn

Read Professional English in Use – Finance Unit 4, “Bookkeeping” before giving a one-minute talk on the following topic:-

Bookkeeping

  • the principle of double-entry bookkeeping
  • the purpose of a “day book”
  • balancing the books

Accounting policies and standards

Speaking part 2: long turn

Read Professional English in Use – Finance Unit 7, “Accounting policies and standards” (only part A is considered) before giving a one-minute talk on the following topics:-

Accounting policies and standards (1)

  • the people who need information about a company’s worth
  • the standards a company must follow when performing valuations
  • how different companies’ valuations can differ

Accounting policies and standards (2)

  • the historical cost principle
  • the consequences of assuming a business is a going concern
  • alternatives to the historical cost principle

Speaking part 3:discussion

A small construction company is reviewing its accounting system, and you have been asked to advise them.

Discussion points:-

  • standards of valuation and measurement to be followed
  • using historical or inflation accounting
  • how the consistency principle will affect possible changes to the system

Accounting assumptions and principles

Speaking part 2: long turn

Read Professional English in Use – Finance Unit 8, “Accounting assumptions and principles” before giving a one-minute talk on the following topics:-

Accounting assumptions

  • what assumptions are made by accountants
  • how these assumptions differ from reality
  • why these assumptions are made

Accounting principles (1)

  • the full-disclosure principle
  • the principle of materiality
  • how these principles affect a business’s financial reports

Accounting principles (2)

  • the principle of conservatism
  • the principle of objectivity
  • what factors can make objectivity difficult

Accounting principles (3)

  • the revenue recognition principle
  • the matching principle
  • how these principles affect a business’s financial reports

The balance sheet (1)

Speaking part 2: long turn

Read Professional English in Use – Finance Unit 11, “The balance sheet (1)” before giving a one-minute talk on the following topics:-

Assets and liabilities

  • what is included in the ‘assets’ section of a balance sheet
  • what is included in the ‘liabilities’ section of a balance sheet
  • how assets and liabilities are related

Shareholders’ equity

  • what shareholders’ equity is
  • where shareholders’ equity comes from
  • how shareholders’ equity is related to assets and liabilities

Read Professional English in Use – Finance Unit 13, “The balance sheet (3): liabilities” before giving a one-minute talk on the following topic:-

Liabilities

  • what ‘liabilities’ are
  • types of current liability
  • the significance of accrued expenses

The other financial statements

Speaking part 2: long turn

Read Professional English in Use – Finance Unit 14, “The other financial statements” before giving a one-minute talk on the following topics:-

The profit and loss account (1)

  • the significance of the ‘turnover’ statement
  • the significance of the ‘cost of goods sold’ (COGS) statement
  • how these statements are combined in the ‘profit and loss account’

The profit and loss account (2)

  • how gross profit is calculated
  • the significance of ‘selling, general and administrative expenses’ (SG&A)
  • what happens to the ‘net profit’ money

The profit and loss account (3)

  • the significance of EBIT
  • the significance of EBITDA
  • why these values are useful to a company

The cash flow statement

  • which transactions are recorded in a cash-flow statement
  • which stransactions are recorded in a ‘statement of total recognised gains and losses’ (STRGL)
  • why this information is useful for a company

Financial ratios 1

Speaking part 2: long turn

Read Professional English in Use – Finance Unit 15, “Financial ratios 1” before giving a one-minute talk on the following topics:-

Financial ratios (1)

  • what ‘liquidity’ means
  • how the ‘current ratio’ is calculated
  • an acceptable value for the ratio, and what it means

Financial ratios (2)

  • the significance of ‘solvency’
  • how the ‘quick ratio’ / ‘acid test’ is calculated
  • why this value can be more useful than the ‘current ratio’

Financial ratios (3)

  • how ‘earnings per share’ (EPS) is calculated
  • how the ‘price/earnings’ (P/E) and ‘dividend cover’ ratios are calculated
  • why these ratios are important for investors

Read Professional English in Use – Finance Unit 16, “Financial ratios 2” before giving a one-minute talk on the following topics:-

Financial ratios (4)

  • how the ‘gross profit margin’ is calculated
  • how ‘return on assets’ and ‘return on equity’ (ROE) are calculated
  • why these measures of profitability are important for investors

Financial ratios (5)

  • how gearing / leverage is calculated
  • how ‘interest cover’ is calculated
  • why these ratios are important for investors
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2 thoughts on “Financial reporting

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