Master of Business Administration

Overview

ACT B861 Accounting for Corporations is a Master of Professional Accounting (MPA)/Postgraduate Diploma in Professional Accounting (PDPA)/Master of Business Administration (MBA)/Master of Corporate Governance (MCG) course in accounting offered by the OUHK. You will find that the course's focus will shift from teaching you about the detailed procedures of accounting to helping you understand accounting concepts. By the time you have completed this course, you should be able to apply these concepts to a variety of businesses in Hong Kong, as well as at an international level.

By working through the study units in this course, you will come to realize that the fundamentals of accounting are not confined to the system of debits and credits that you will practise quite extensively at the beginning of this course. At an advanced level of accounting, it is important to learn about the adaptability and usefulness of different accounting concepts and how they apply to different industries in the business world today.

This course has been designed so that you can work through the major topics and sub-topics introduced in each unit. Throughout each unit you will be instructed to read certain texts and articles, and complete various specified activities and self-test questions.

The activities following each topic or sub-topic consist of questions designed to test your understanding of the topic you have just studied. Some questions may require you to do additional research. At the end of each topic, there are also self-test questions that test your understanding of the topics. To derive maximum benefit from your study, you are advised to attempt all the activities and self-test questions in this study unit on your own. You may consult the suggested answers at the end of the unit to check your responses.

It is very important that you use this and the other units to guide your study. However, they should not be used as an alternative to your textbook -- the study units have been carefully designed to be used together with the assigned textbook to give you a comprehensive course of study.

In this course, you will learn about the primary financial statements prepared by most businesses, namely, the statement of financial position, the statement of comprehensive income, the statement of cash flow and the statement of changes in equity. This unit focuses on a broader scope of financial reporting, and introduces the causal relationship between the development of financial statements and users' needs. In this course, our emphasis is on corporations.

2 ACT B861 Accounting for Corporations

Introduction

Accounting has been traditionally viewed as a practical subject. Some people think that it is a boring, technical subject. Others perceive accountants as dull people. What is accounting anyway? Accounting is, in effect, about communicating financial information. In this unit, we will start with an overview of the theories of accounting. In particular, the meaning of transactions, entities and resources will be looked at from the accounting perspective. Two theories, the equity theory and the entity theory, will be discussed as part of the unit. Remember that accounting statements are prepared for people who need the information. We will identify who these users are. In some cases, different users will have different needs and, therefore, their requirements for financial statements will be different. Here in this course, we will concentrate on the general uses of accounting information.

Having given an overview of some accounting theories, this unit will then introduce the conceptual