Financial Accounting 2 LO2: The role of accounting and accounting records | IFA Direct

Learning Outcome 2 of Financial Accounting 2 (T/650/9637), Level 4 Unit 2 of the ATHE Level 4 Extended Diploma in Accounting, taught by UK Versity for learners on the IFA Direct programme. LO2: Understand the role of accounting and accounting records within an organisation. This learning outcome shows how a small business keeps its financial records. You will learn why records matter, how double entry works, how to post to ledger accounts and balance them, how to separate capital and revenue items, and how to produce a trial balance that tests your work. Assessment criteria covered: 2.1: Explain the role and common format of accounting and accounting records within a SME/SMP 2.2: Explain systems for reporting financial transactions 2.3: Produce a trial balance from double entry accounting records Chapters 0:00 LO2 overview, aim and assessment criteria 0:30 Session roadmap 0:51 The role of accounting in an SME or SMP 1:54 The common format: from transaction to financial statements 2:31 Double entry bookkeeping: the dual aspect 3:18 Types of ledger account and their normal balance 4:06 Worked example 1: analysing one transaction 4:50 Ten transactions analysed into debits and credits 5:31 Ledger: the Bank account as a T-account 6:12 Worked example 2: balancing the Bank account 7:03 Ledger: Receivables and Payables 7:43 Ledger: Sales, Capital, Equipment and Drawings 8:17 Making transfers to final accounts 8:57 Worked example 3: from ledgers to final accounts 9:51 Manual and computerised accounting systems 10:39 Other accounting records in an SME 11:23 When the computer system is wrong: Post Office Horizon 12:10 Capital expenditure and revenue expenditure 13:05 Classifying expenditure and receipts 13:52 Capital or revenue: a new machine 14:43 Steps to produce a trial balance 15:36 Worked example 4: extracting the trial balance 16:21 Trial balance of Patel Cycle Repairs at 31 January 16:52 What a balancing trial balance does not show 17:45 A trial balance out by £180 18:36 Key terms 18:52 Activity: post and balance 19:18 Check your understanding 19:45 What Pass, Merit and Distinction look like 20:23 Summary 21:08 Plenary: further reading and resources 21:43 Plenary Watch the full IFA Direct playlist on the UK Versity channel:    / @ukversity   Study accounting online with UK Versity: https://www.ukversity.co.uk Course enquiries: admin@ukversity.co.uk #IFADirect #ATHE #Accounting #UKVersity #FinancialAccounting2 #AccountingStudents UK Versity disclaimer: This video is UK Versity teaching material for learners on the ATHE Level 4 Extended Diploma in Accounting, studied with UK Versity on the IFA Direct programme. UK Versity is an ATHE approved centre; the video is produced by UK Versity and is not issued or endorsed by ATHE or the Institute of Financial Accountants. It is for study only and is not legal, tax, financial or professional advice. Organisation names are used for educational comment only. Figures and rules are correct at the time of recording; always check current guidance and your assignment brief. © UK Versity Online Limited. All rights reserved. COPYRIGHT NOTICE: All content in this video is the exclusive intellectual property of UK Versity Online. This video, in whole or in part, may not be copied, reproduced, distributed, uploaded to any third-party platform, embedded, or integrated into any website, application, or learning management system without the prior written permission of UK Versity Online and the payment of applicable royalties. Unauthorised use, reproduction, or distribution of this content constitutes an infringement of UK Versity's intellectual property rights and will be subject to legal action under applicable UK and international copyright law. For licensing or permissions enquiries, contact: info@ukversity.co.uk