Program General Objective:
Develop the trainees' abilities to perform accounting by accurately and proficiently processing financial transactions through the stages of the commercial accounting cycle.
Skills the Program Aims to Develop:
The ability to perform all stages of the financial accounting cycle efficiently and effectively.
Objectives:
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Theoretical framework of accounting.
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Budget processing.
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The accounting cycle.
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Financial accounting.
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Practical cycle.
Outcomes:
By the end of the training, the trainee is expected to be able to:
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Easily understand financial accounting terminology.
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Identify the impact of financial transactions on budget processing with ease.
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Identify the stages of the accounting cycle easily.
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Accurately and proficiently record entries in the journal.
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Accurately and proficiently post to the general ledger.
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Accurately and proficiently prepare the trial balance.
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Accurately and proficiently prepare adjusting entries related to the "Statement of Owner's Equity and Income Statement."
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Accurately and proficiently prepare the work sheet.
About course
Financial Accounting is one of the key essentials in business and economic management, playing a central role in analyzing financial data and making strategic decisions. In this course, you will learn the fundamental principles of financial accounting used to prepare accurate financial reports, such as the balance sheet, income statement, and cash flow statement.
This course aims to teach you basic accounting concepts such as assets, liabilities, and equity, and how to prepare financial reports according to the latest accounting standards such as the International Financial Reporting Standards (IFRS) and GAAP. We will also cover essential accounting principles such as the accrual principle, historical cost, and objectivity, which are the foundations for understanding the financial accounting system.
By the end of the course, you will be able to apply accounting concepts in practice by analyzing financial statements and using financial ratios to assess the financial performance of companies.
Start now and learn the principles of financial accounting to be qualified for any accounting or financial job with confidence, along with a certified certificate that supports your professional career.
What are the Basic Principles of Financial Accounting?
The basic principles of financial accounting are the foundation upon which the financial accounting system of any organization or institution is built. These principles help ensure the accuracy, transparency, and accountability of financial data in reports. Through these principles, the way financial transactions are recorded and how financial reports such as the balance sheet and income statement are prepared are determined.
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Accrual Principle
The accrual principle is one of the fundamental principles in financial accounting, where revenues and expenses are recorded when the transactions occur, not when the money is collected or paid. This principle helps achieve greater accuracy in financial reporting and is essential for understanding the actual financial position of the organization.
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Historical Cost Principle
The historical cost principle means that assets are recorded at the value that was initially paid to acquire them, regardless of the current market value of the asset. This principle helps ensure transparency and boosts trust in financial reports by showing the true value of assets based on actual transactions.
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Going Concern Principle
The going concern principle assumes that financial entities will continue their business operations in the near future. This principle helps interpret financial data based on the assumption that the organization will continue its activities in the future, influencing how financial reports are prepared.
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Matching Principle
The matching principle requires that revenues be matched with expenses in the same accounting period. This principle is essential for analyzing financial results as it ensures that revenues are aligned with the costs incurred to generate them, helping in accurate profitability assessments.
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Objectivity Principle
The objectivity principle is one of the most important principles in financial accounting, ensuring that financial transactions are recorded based on reliable facts and evidence, such as invoices, contracts, or bank statements. This principle helps reduce bias and enhances credibility in preparing financial reports.
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Conservatism Principle
The conservatism principle requires that losses be recorded when they are identified, while revenues are recorded only when they become realized or certain. This principle helps reduce financial risks and ensures that financial reports do not overstate revenues or profits.
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Full Disclosure Principle
The full disclosure principle requires companies to disclose all necessary information that affects the decisions of users of their financial reports. This principle helps ensure transparency and enables investors and financial analysts to make investment decisions based on accurate and comprehensive information.
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Consistency Principle
The consistency principle states that organizations must use the same accounting methods from one period to another. This principle ensures that financial reports are comparable over the long term and allows users to compare financial performance between different periods.
The basic principles of financial accounting are crucial for ensuring the accuracy and reliability of financial data prepared by companies. By applying these principles, institutions can ensure transparency and financial accountability, which enhances trust in financial reports and helps make sound financial decisions.
If you wish to learn the basic principles of financial accounting and apply them professionally, Bader Center offers specialized training courses in financial accounting with certified certificates that open up great opportunities in the job market. Start now and develop your financial accounting skills with Bader Center!
Comparison Between International and Local Accounting Standards
Accounting standards are essential for preparing financial reports and significantly impact how financial transactions are recorded and financial statements are prepared. International accounting standards (such as IFRS) differ from local standards (such as GAAP in the U.S. or Egyptian standards) in some key areas. In this article, we will compare international and local accounting standards and the importance of these differences in enhancing financial transparency and accountability in companies and institutions.
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Definition of International and Local Accounting Standards
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International Financial Reporting Standards (IFRS): A set of rules established by the International Accounting Standards Board (IASB) to regulate financial accounting globally. The goal is to standardize and simplify corporate reporting worldwide.
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Local Accounting Standards (such as GAAP): A set of rules developed by national institutions, such as the Financial Accounting Standards Board (FASB) in the U.S. or the Egyptian Accounting Standards Committee, which address accounting systems applied locally.
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The Primary Goal of Each Standard
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International Standards (IFRS): Aim to document and align financial accounting at a global level, facilitating the comparison of financial statements between companies across multiple markets.
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Local Standards: Aim to meet the needs of the local financial system, allowing for practical applications that suit the local economy and its specific conditions.
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The Main Accounting Principle
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In IFRS, the focus is on principles rather than specific rules. This means accountants rely on appropriate interpretations of real-world cases based on economic trends.
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In local standards such as GAAP, the focus is on detailed rules that accountants must follow, offering less room for personal interpretation.
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Revenue and Expense Recognition
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IFRS: Requires recognition of revenues and expenses when they are realized, i.e., when risks and rewards are transferred, regardless of cash timing.
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Local standards (such as GAAP): May differ in some cases in how revenue is allocated and determining post-purchase expenses, preferring to recognize them in specified accounting periods.
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Preparation of Financial Reports
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In IFRS, companies are expected to adhere to flexibility in presenting financial reports to ensure more transparency and adaptability to market changes.
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In local standards, more specific financial reports are required, and companies must comply strictly with laws that must be adhered to.
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Fair Value vs. Historical Cost
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IFRS: Encourages using fair value to evaluate assets and liabilities (e.g., securities and real estate).
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Local standards: May prefer historical cost or market value assessment in some cases, which varies from country to country.
International and local accounting standards are both fundamental in preparing financial reports, with each serving a special purpose according to local and global circumstances. Global companies prefer international standards as they facilitate international expansion, while local companies may continue to rely on national standards to meet the needs of the local market.
If you want to understand international and local accounting standards better and apply them in your work, Bader Center offers specialized training courses in financial accounting. Start now and develop your skills with Bader Center!
Best Content for the Financial Accounting Principles Course
Financial accounting principles are the foundation upon which the financial system is built to prepare financial reports and provide accurate financial analysis. In this course, we will cover the core concepts of financial accounting, starting from preparing financial statements to analyzing financial results and preparing reports in accordance with internationally recognized accounting standards.
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Core Financial Statements
Core financial statements are fundamental tools that allow accountants and financial professionals to analyze a company’s financial position. In this course, we will cover the three core financial statements that help assess financial performance:
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Balance Sheet: Shows the company’s financial position at a specific point in time, highlighting assets, liabilities, and equity. This statement helps evaluate the company's ability to bear debt and achieve financial stability.
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Income Statement: Demonstrates profits and losses achieved over a specified period. It helps measure profitability by comparing revenues with expenses.
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Cash Flow Statement: Displays cash inflows and outflows during a specified period. This statement helps in analyzing liquidity and determining the company’s ability to finance operations and meet financial obligations.
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Financial Analysis
Financial analysis is the process of studying financial data to determine the company’s ability to achieve profits and manage liquidity. In this course, we will cover various methods of analyzing financial data using financial ratios:
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Using Financial Ratios: Financial ratios are used to measure company performance by comparing multiple variables such as profitability ratios, liquidity ratios, and efficiency ratios.
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Profitability and Liquidity Analysis: Profitability analysis studies the returns generated by the company from its various operations, such as gross profit and net profit. Liquidity analysis helps evaluate the company’s ability to meet its short-term financial obligations by examining available cash.
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Efficiency and Solvency Analysis: Efficiency analysis helps determine how effectively the company uses available resources, while solvency analysis focuses on the company’s ability to bear debt and achieve long-term stability.
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Financial Reporting and Compliance
Preparing financial reports is one of the key tasks in financial accounting, as these reports help provide an accurate picture of the company’s financial performance. Compliance with accounting standards is also crucial to ensure the accuracy and credibility of these reports:
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Preparing Financial Reports According to Accounting Standards: Financial reports are prepared using international accounting standards such as IFRS or local standards such as GAAP, ensuring uniformity and accuracy in the data presented.
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Compliance with International Financial Reporting Standards (IFRS): Compliance with IFRS aims to improve transparency and comparability between companies globally. International standards focus on unifying measurement and recognition of financial transactions.
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Compliance with Local Standards such as GAAP: Although international standards are more widespread, some companies may comply with local standards like GAAP (Generally Accepted Accounting Principles) in the U.S. to ensure compatibility with local laws and provide accurate financial reports.
Financial accounting principles rely on a set of core accounting concepts that contribute to preparing financial statements and analyzing financial performance effectively. By understanding the balance sheet, income statement, and cash flow statement, to analyzing financial data using financial ratios, this course helps develop financial accounting skills in line with global and local accounting standards.
