level 3 diploma in accounting (7437-03) providing cost and revenue information a/600/4951 3 4 ......

Level 3 Diploma in Accounting (7437-03) Qualification handbook for centres 500/9993/0 www.cityandguilds.com

October 2010 Version 1.0

About City & Guilds City & Guilds is the UK’s leading provider of vocational qualifications, offering over 500 awards across a wide range of industries, and progressing from entry level to the highest levels of professional achievement. With over 8500 centres in 100 countries, City & Guilds is recognised by employers worldwide for providing qualifications that offer proof of the skills they need to get the job done. City & Guilds Group The City & Guilds Group includes City & Guilds, ILM (the Institute of Leadership & Management, which provides management qualifications, learning materials and membership services), City & Guilds NPTC (which offers land-based qualifications and membership services), City & Guilds HAB (the Hospitality Awarding Body), and City & Guilds Centre for Skills Development. City & Guilds also manages the Engineering Council Examinations on behalf of the Engineering Council. Equal opportunities City & Guilds fully supports the principle of equal opportunities and we are committed to satisfying this principle in all our activities and published material. A copy of our equal opportunities policy statement is available on our website. Copyright The content of this document is, unless otherwise indicated, © The City and Guilds of London Institute and may not be copied, reproduced or distributed without prior written consent. However, approved City & Guilds centres and candidates studying for City & Guilds qualifications may photocopy this document free of charge and/or include a PDF version of it on centre intranets on the following conditions:

• centre staff may copy the material only for the purpose of teaching candidates working towards a City & Guilds qualification, or for internal administration purposes

• candidates may copy the material only for their own use when working towards a City & Guilds qualification

The Standard Copying Conditions (which can be found on our website) also apply. Please note: National Occupational Standards are not © The City and Guilds of London Institute. Please check the conditions upon which they may be copied with the relevant Sector Skills Council. Publications City & Guilds publications are available from our website or from our Publications Sales department, using the contact details shown below. Every effort has been made to ensure that the information contained in this publication is true and correct at the time of going to press. However, City & Guilds’ products and services are subject to continuous development and improvement and the right is reserved to change products and services from time to time. City & Guilds cannot accept liability for loss or damage arising from the use of information in this publication. City & Guilds 1 Giltspur Street London EC1A 9DD T +44 (0)844 543 0000 www.cityandguilds.com F +44 (0)20 7294 2413 [email protected]

Level 3 Diploma in Accounting (7437-03) 1

Level 3 Diploma in Accounting (7437-03) Qualification handbook for centres

www.cityandguilds.com October 2010 Version 1.0

2 Level 3 Diploma in Accounting (7437-03)

City & Guilds Skills for a brighter future

www.cityandguilds.com


Contents

1 Introduction to the qualification 5 1.1 Qualification structure 6 1.2 Opportunities for progression 6 1.3 Qualification support materials 6 2 Centre requirements 7 2.1 Centre approval 7 2.2 Resource requirements 7 2.3 Candidate entry requirements 8 3 Course design and delivery 9 3.1 Initial assessment and induction 9 3.2 Recommended delivery strategies 9 4 Assessment 10 4.1 Summary of assessment methods 10 4.2 Workplace assessment and simulation 10 4.3 Evidence for assessment 11 4.4 Recording forms 11 4.5 Time constraints 11 4.6 Recognition of prior learning (RPL) 11 5 Units 12 Unit 301 Prepare accounts for partnerships 13 Unit 302 Providing Cost and Revenue Information 17 Unit 303 Prepare final accounts for sole traders 21 Unit 304 Principles of VAT 24 Unit 305 Preparing and Completing VAT returns 26 Unit 306 Cash Management 29 Unit 307 Principles of Accounts Preparation 33 Unit 308 Extending the trial balance using accounting adjustments 38 Unit 309 Principles of Costing 42 Unit 310 Principles of Cash Management 46 Unit 311 Accounting for fixed assets 50 Unit 312 Spreadsheet Software 55 Unit 313 Professional Ethics in Accounting and Finance 59 Appendix 1 Sources of general information 63


1 Introduction to the qualification

This document contains the information that centres need to offer the following qualification: Qualification title and level Level 3 Diploma in Accounting City & Guilds qualification number 7437-03 Qualification accreditation number 500/ 9993/0 Last registration date 30/06/2014 Last certification date 30/06/2017 The City & Guilds Level 3 Diploma in Accounting aims to provide opportunities for candidates to develop and evidence their practical skills, knowledge, and understanding in accounting principles, processes and procedures. Candidates will be able to demonstrate their ability to undertake complex and non routine accounting tasks, work autonomously, exercise judgement and inform decision making.

Contacting the Standard Setting Body The Financial Services Skills Council 51 Gresham Street London EC2V 7HQ Tel: 0845 257 3772 Website: www.fssc.org.uk


1.1 Qualification structure To achieve the Level 3 Diploma in Accounting, learners must achieve: 41 credits from the 13 Mandatory Units The table below illustrates the unit titles, the credit value of each unit and the title of the qualification which will be awarded to candidates successfully completing the required combination of units and/or credits.

City & Guilds unit number

Mandatory units Unit accreditation number

QCF Level

QCF Credit

7437-301 Prepare accounts for partnerships A/600/4934 3 2

7437-302 Providing cost and revenue information A/600/4951 3 4

7437-303 Prepare final accounts for sole traders F/600/4935 3 4

7437-304 Principles of VAT F/600/4952 3 2

7437-305 Preparing and Completing VAT returns J/600/4953 3 2

7437-306 Professional ethics in accounting and finance K/600/4962 3 3

7437-307 Cash management L/600/4940 3 3

7437-308 Principles of accounts preparation M/600/4929 3 4

7437-309 Extending the trial balance using accounting adjustments

M/600/4932 3 3

7437-310 Principles of costing M/600/4946 3 4

7437-311 Principles of cash management R/600/4938 3 2

7437-312 Accounting for fixed assets Y/600/4942 3 2

7437-313 Spreadsheet software J/502/4626 3 6

1.2 Opportunities for progression On completion of this qualification candidates may progress into employment or to the following City & Guilds qualifications:

• Advanced Apprenticeship in Accounting.

• Leadership and Management qualifications with ILM.

• Awards, Certificates or Diplomas’ in other work-related areas (for example Business Administration, Retail, Contact Centres, ITQ)

1.3 Qualification support materials City & Guilds also provides the following publications and resources specifically for this qualification:

Description How to access

Generic candidate recording forms www.cityandguilds.com

Centre guide www.cityandguilds.com

Promotional materials www.cityandguilds.com


2 Centre requirements

2.1 Centre approval This section outlines the approval processes for Centres to offer this qualification and any resources that Centres will need in place to offer the qualifications including qualification-specific requirements for Centre staff. Centres already offering City & Guilds qualifications in this subject area Centres approved to offer the qualification Level 3 NVQ in Accounting (7421-03) will be given automatic approval for the new Level 3 Diploma in Accounting (7437-03). Existing sanctions will apply to the new qualifications. Centres not already offering City & Guilds qualifications in this subject area To offer these qualifications, centres already approved to deliver City & Guilds qualifications will need to gain qualification approval. Please refer to Appendix 1 for further information. Centres not yet approved by City & Guilds To offer these qualifications, new centres will need to gain both centre and qualification approval. Please refer to Appendix 1 for further information.

2.2 Resource requirements Centre staff may undertake more than one role, eg tutor and assessor or internal verifier, but must never internally verify their own assessments.

Assessors, internal verifiers and external verifiers

Centre staff should hold, or be working towards, the relevant Assessor/Verifier (A/V) units for their role in delivering, assessing and verifying this qualification. They must be able to demonstrate that they meet the following occupational expertise requirements. They should:

• have relevant and credible occupational experience, including understanding of current and emerging practice, issues and legislative requirements in accounting. Each practitioner will normally have operated at or above the level of the qualification that they are assessing or verifying

• hold a relevant vocational or professional award or other recognised evidence of occupational competence at least one level above that of the qualification being assessed or verified

or

• hold a relevant vocational/professional award or other recognised evidence of occupational competence and provide sufficient evidence of experience and expertise at the level of the qualification being assessed or verified

and have good interpersonal skills


Continuing professional development (CPD)

Centres are expected to support their staff in ensuring that their knowledge remains current of the occupational area and of best practice in delivery, mentoring, training, assessment and verification, and that it takes account of any national or legislative developments.

2.3 Candidate entry requirements Candidates should not be entered for a qualification of the same type, content and level as that of a qualification they already hold. There are no formal entry requirements for candidates undertaking this qualification. However, centres must ensure that candidates have the potential and opportunity to gain the qualification successfully.

Age restrictions

This qualification is not approved for use by candidates under the age of 16 and City & Guilds cannot accept any registrations for candidates in this age group. There are no other age limits attached to candidates undertaking this qualification unless it is a legal requirement of the process or the environment.


3 Course design and delivery

3.1 Initial assessment and induction Centres will need to make an initial assessment of each candidate prior to the start of their programme to ensure they are entered for an appropriate type and level of qualification. The initial assessment should identify:

• any specific training needs the candidate has, and the support and guidance they may require when working towards their qualification. This is sometimes referred to as diagnostic testing.

• any units the candidate has already completed, or credit they have accumulated which is relevant to the qualification they are about to begin.

City & Guilds recommends that centres provide an induction programme to ensure the candidate fully understands the requirements of the qualification they will work towards, their responsibilities as a candidate, and the responsibilities of the centre. It may be helpful to record the information on a learning contract.

3.2 Recommended delivery strategies Centre staff should familiarise themselves with the structure, content and assessment requirements of the qualification before designing a course programme. Centres may design course programmes of study in any way which:

• best meets the needs and capabilities of their candidates

• satisfies the requirements of the qualification

• considers the opportunity to deliver units together which contain some of the same, similar or complementary learning outcomes or assessment criteria

• considers the suitability, practicality and cost or time benefits of holistic teaching delivery wherever possible

When designing and delivering the course programme, centres might wish to incorporate other teaching and learning that is not assessed as part of the qualification. This might include the following:

• literacy, language and/or numeracy

• personal learning and thinking

• personal and social development

• employability Where applicable, this could involve enabling the candidate to access relevant qualifications covering these skills.


4 Assessment

4.1 Summary of assessment methods For this qualification, the following assessment: techniques are acceptable:

• Workplace assessment • Work-based assessment (workplace simulation) • Oral presentation and questioning Additional guidance • Although individual Accounting units define specific learning outcomes and assessment criteria,

it is not a requirement that the units be assessed individually

• Where two or more Accounting units within a qualification contain some of the same, similar or complementary learning outcomes or assessment criteria, it is acceptable and potentially desirable that such units are assessed together where practicable.

4.2 Workplace assessment and simulation Assessment through observation of candidate performance on tasks naturally undertaken in the workplace should contribute to awards wherever appropriate and practicable. Workplace assessment may take various forms, but the methods adopted must allow learners too fully to demonstrate their attainments against the assessment criteria. Work-based assessment may be required in some instances in order to replicate, as closely as possible, the performance expected in employment. The simulation of tasks and activities normally undertaken in the workplace may be required to enable candidates to generate the quality of evidence that is required. This simulation may be computer-based where that closely resembles workplace practice. The use of simulation will legitimately vary across occupational areas, reflecting employment realities:

• In accounting and closely related occupations, individuals are normally required to be qualified before they can be considered for the corresponding job. They also deal with confidential and personal information. Simulation is therefore frequently necessary in the interests of access to and the integrity of data

• In payroll administration, workplace evidence is strongly encouraged, though circumstances can arise where an element of simulation may be necessary, for example due to restrictions on the release of employee data

• Centres must provide a clear, occupationally specific rationale whenever workplace simulation is included in particular assessment schemes. Centres must also ensure that the design and delivery of all simulations, whether centrally or locally managed, accord with the following principles:

• Content must be based on the QCF units under assessment

• Performance must be assessed against the assessment criteria in the relevant QCF units.

• The conditions within which a simulation is deployed must resemble the up-to-date workplace as closely as is practicable. Attention must be paid to relevant legal requirements; the realism of the setting and any associated equipment; workplace and customer relationships; and the pace and intensity of work-related activity


4.3 Evidence for assessment A portfolio of evidence which covers the assessment criteria for each unit or combination of units.

4.4 Recording forms Candidates and centres may decide to use a paper-based or electronic method of recording evidence. City & Guilds has developed a set of Recording forms including examples of completed forms, for new and existing centres to use as appropriate.

4.5 Time constraints The following time constraint must be applied to the assessment of this qualification:

• Assessment must be completed within the candidate’s period of registration.

4.6 Recognition of prior learning (RPL) Recognition of Prior Learning (RPL) recognises the contribution a person’s previous experience could contribute to a qualification. RPL is allowed for this qualification and is not sector specific


5 Units

Availability of units

The Accounting units for this qualification follow. The learning outcomes and assessment criteria are also viewable on the Register of Regulated Qualifications http://register.ofqual.gov.uk

Structure of units

The units in this qualification are written in a standard format and comprise the following:

• City & Guilds reference number • unit accreditation number • title • level • credit value • unit aim • relationship to NOS, other qualifications and frameworks • endorsement by a Sector Skills Council (SSC) • information on assessment • learning outcomes which are comprised of a number of assessment criteria


Unit 301 Prepare accounts for partnerships

Level: 3 Credit value: 2 NDAQ number: A/600/4934 Unit aim This unit aims to introduce the learner to the legal requirements and the preparation of partnership accounts. The learner will be able to prepare final accounts for a partnership showing the division of profits after adjusting for interest on capital, interest on drawings and any salaries due to each partner. Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Have a basic understanding of legislation relating to the formation of a partnership 2. Prepare a profit and loss appropriation account 3. Prepare a balance sheet relating to a partnership Guided learning hours It is recommended that 15 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit FA-4. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 301 Prepare accounts for partnerships Outcome 1 Have a basic understanding of legislation relating to

the formation of a partnership

Assessment Criteria The learner can: 1. Describe the key components of a partnership agreement 2. Identify and describe the key components of partnership accounts

• profit and loss account (income statement) • partnership appropriation account, • goodwill • partners’ current accounts • partners’ capital accounts • balance sheet (statement of financial position)


Unit 301 Prepare accounts for partnerships Outcome 2 Prepare a profit and loss appropriation account

Assessment Criteria The learner can: 1. Prepare the profit and loss (income statement) appropriation account for a partnership 2. Accurately determine the allocation of profit to partners after allowing for interest on capital,

interest on drawings and any salary paid to partner(s). 3. Prepare the current accounts for each partner and calculate the closing balance.


Unit 301 Prepare accounts for partnerships Outcome 3 Prepare a balance sheet relating to a partnership

Assessment Criteria The learner can: 1. Record accurately the closing balances on each partner’s capital and current accounts,

including drawings. 2. Prepare a balance sheet (statement of financial position) for a partnership, in compliance with

the partnership agreement


Unit 302 Providing Cost and Revenue Information

Level: 3 Credit value: 4 NDAQ number: A/600/4951 Unit aim This unit is about understanding principles of costing. Learners will be able to identify why cost accounting is an important tool to an organisation, and be able to recognise different approaches and make informed reasoned judgements to inform management on the most effective costing techniques to aid decision making. Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Record and analyse information relating to costs 2. Apportion costs according to organisational requirements 3. Correctly identify any significant deviations and report these to management Guided learning hours It is recommended that 35 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit MA-2. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 302 Providing Cost and Revenue InformationUnit 302 Providing Cost and Revenue Information Outcome 1 Record and analyse information relating to costs

Assessment Criteria The learner can: 1. Record and analyse costs in accordance with the organisation’s costing procedures. 2. Analyse cost information for materials, labour and expenses.


Unit 302 Providing Cost and Revenue Information Outcome 2 Apportion costs according to organisational

requirements

Assessment Criteria The learner can: 1. Attribute overhead costs to production and service cost centres in accordance with agreed

bases of allocation and apportionment. 2. Calculate overhead absorption rates in accordance with agreed bases of absorption. 3. Make adjustments for under and over recovered overhead costs in accordance with established

procedures. 4. Review methods of allocation, apportionment and absorption at regular intervals and

implement agreed changes to methods. 5. Communicate with relevant staff to resolve any queries in overhead cost data.


Unit 302 Providing Cost and Revenue Information Outcome 3 Correctly identify any significant deviations and

report these to management

Assessment Criteria The learner can: 1. Compare budget costs with actual costs and note any variances. 2. Analyse variances accurately and prepare relevant reports for management. 3. Inform budget holders and other managers of any significant variances; making valid

suggestions for remedial action. 4. Prepare estimates of future income and costs for decision making. 5. Prepare reports in an appropriate format and present these to management within the required

timescales.


Unit 303 Prepare final accounts for sole traders

Level: 3 Credit value: 4 NDAQ number: F/600/4935 Unit aim This unit aims to develop the learner’s accounting skills in restructuring accounting information and. preparing final accounts for a sole trader. It includes the accounting treatment required to incorporate accruals and prepayments, provision for depreciation, irrecoverable debts and allowance for doubtful debts. Learning outcomes There are two learning outcomes to this unit. The learner will be able to: 1. Prepare accounting records from incomplete information 2. Produce accurate final accounts Guided learning hours It is recommended that 35 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit FA-4. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 303 Prepare final accounts for sole traders Outcome 1 Prepare accounting records from incomplete

information

Assessment Criteria The learner can: 1. Calculate accurately the opening and/or closing capital using incomplete information 2. Calculate accurately the opening and/or closing cash/bank account balance 3. Prepare sales and purchases ledger control accounts and use these to correctly calculate sales,

purchases and bank figures 4. Calculate accurately account balances using mark ups and margins 5. Prepare accurately journal entries or ledger accounts to take account of;

• closing stock

• accruals and prepayments

• depreciation,

• allowance for doubtful debts

• irrecoverable debts

• the gain/loss on disposal of a fixed asset

• purchase of assets


Unit 303 Prepare final accounts for sole traders Outcome 2 Produce accurate final accounts

Assessment Criteria The learner can: 1. Produce a trial balance from accounting information 2. Prepare a profit and loss account (income statement) 3. Prepare a balance sheet (statement of financial position)


Unit 304 Principles of VAT

Level: 3 Credit value: 2 NDAQ number: F/600/4952 Unit aim This unit is about understanding the current VAT regulations. Learners will understand the VAT registration requirements, the different VAT schemes available, the penalties for non-compliance and the different types of classification of supplies. Learning outcomes There is one learning outcome to this unit. The learner will be able to: 1. Understand VAT regulations Guided learning hours It is recommended that 15 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit T-3. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 304 Principles of VAT Outcome 1 Understand VAT regulations

Assessment Criteria The learner can: 1. Identify sources of information on VAT 2. Explain the relationship between the organisation and the relevant government agency. 3. Explain the VAT registration requirements 4. Identify the information that must be included on business documentation of VAT registered

businesses. 5. Recognise different types of inputs and outputs. 6. Identify how different types of supply are classified for VAT purposes.

• Standard supplies,

• exempt supplies,

• zero rated supplies,

• imports

• exports 7. Explain the requirements and the frequency of reporting for the following VAT schemes

• Annual accounting,

• cash accounting,

• flat rate scheme,

• standard scheme 8. Recognise the implications and penalties for the organisation resulting from failure to abide by

VAT regulations including the late submission of VAT returns


Unit 305 Preparing and Completing VAT returns

Level: 3 Credit value: 2 NDAQ number: J/600/4953 Unit aim This unit is about calculating VAT and submitting the VAT return. It involves extracting the relevant information from the organisations accounting records; calculating the amount of tax payable or reclaimable and resolving errors or omissions. Learners must be able submit completed documentation in a timely manner whilst maintaining an effective working relationship with the relevant tax authority. Learning outcomes There are two learning outcomes to this unit. The learner will be able to: 1. Complete VAT returns accurately and in a timely manner 2. Communicate VAT information Guided learning hours It is recommended that 15 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit T-3. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 305 Preparing and Completing VAT returns Outcome 1 Complete VAT returns accurately and in a timely

manner

Assessment Criteria The learner can: 1. Correctly identify and extract relevant data for a specific period from the accounting system. 2. Calculate accurately relevant inputs and outputs

• Standard supplies, • exempt supplies, • zero rated supplies, • imports, • exports

3. Calculate accurately the VAT due to, or from, the relevant tax authority 4. Make adjustments and declarations for any errors or omissions identified in previous VAT

periods 5. Complete accurately and submit a VAT return within the statutory time limits along with any

associated payments


Unit 305 Preparing and Completing VAT returns Outcome 2 Communicate VAT information

Assessment Criteria The learner can: 1. Inform managers of the impact that the VAT payment may have on the company cash flow and

financial forecasts. 2. Advise relevant people of the impact that any changes in VAT legislation, including the VAT rate,

would have on the organisation’s recording systems 3. Communicate effectively with the relevant tax authority when seeking guidance


Unit 306 Cash Management

Level: 3 Credit value: 3 NDAQ number: L/600/4940 Unit aim This unit is about managing cash balances to ensure the ongoing liquidity of an organisation. The learner will be able to make informed decisions regarding both borrowing and investing surplus funds. Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Prepare forecasts of income and expenditure for a given accounting period 2. Use forecasts to monitor cash flow within the organisation 3. Use cash balances effectively Guided learning hours It is recommended that 25 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit TM-1. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 306 Cash Management Outcome 1 Prepare forecasts of income and expenditure for a

given accounting period

Assessment Criteria The learner can: 1. Determine the likely pattern of cash flows over the accounting period, and anticipate any

exceptional receipts or payments. 2. Ensure forecasts of future cash payments and receipts agree with known income and

expenditure trends. 3. Prepare cash budgets and clearly indicate net cash requirements.


Unit 306 Cash Management Outcome 2 Use forecasts to monitor cash flow within the

organisation

Assessment Criteria The learner can: 1. Monitor cash receipts and payments against budgeted cash flow. 2. Identify significant deviations from the cash budget and take corrective action within

organisational policies.


Unit 306 Cash Management Outcome 3 Use cash balances effectively

Assessment Criteria The learner can: 1. Observe the organisation's financial regulations and security procedures 2. Take account of trends in the economic and financial environment in managing cash balances 3. Manage cash, overdrafts and loans in order to maintain an adequate level of liquidity in line with

cash forecasts. 4. Anticipate cash requirements and arrange overdraft and loan facilities on the most favourable

terms available. 5. Invest surplus funds according to organisational policy and within defined financial

authorisation limits.


Unit 307 Principles of Accounts Preparation

Level: 3 Credit value: 4 NDAQ number: M/600/4929 Unit aim This knowledge based unit aims to enable learners to understand the procedures involved in, and the reasons for, preparing final accounts for sole traders. It raises awareness of the accounting systems that a business must put in place in order to produce meaningful information at the end of an accounting period. The unit also aims to provide the learner with an understanding of the environment and principles in which the business operates. Learning outcomes There are four learning outcomes to this unit. The learner will be able to: 1. Understand generally accepted accounting principles and concepts 2. Understand the principles of double entry bookkeeping 3. Understand the accounting methods used to record assets, liabilities, income, expenses and

capital 4. Understand the need for, and the process involved in, the preparation of final accounts Guided learning hours It is recommended that 35 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit FA-4. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 307 Principles of Accounts Preparation Outcome 1 Understand generally accepted accounting

principles and concepts

Assessment Criteria The learner can: 1. Explain the accounting principles of going concern, accruals, prudence and consistency 2. Explain the purpose and importance of maintaining financial records for internal and external

use. 3. Describe the type of accounting records that a business should maintain and the main uses

of each 4. Describe main requirements of accounting standards in relation to stock and fixed asset

valuations 5. Explain the accounting characteristics relating to relevance, reliability, comparability, ease of

understanding and materiality.


Unit 307 Principles of Accounts Preparation Outcome 2 Understand the principles of double entry

bookkeeping

Assessment Criteria The learner can: 1. Explain the meaning of the accounting equation 2. Describe the meaning of assets, liabilities and capital in an accounting context 3. Describe the components of a set of final accounts for a sole trader 4. Explain the purpose and use of books of prime entry and ledger accounts 5. Explain the purpose of reconciliation of the sales and purchases ledgers, and the cash book


Unit 307 Principles of Accounts Preparation Outcome 3 Understand the accounting methods used to

record assets, liabilities, income, expenses and capital

Assessment Criteria The learner can: 1. Explain the differences between capital and revenue expenditure 2. Describe how the acquisition of fixed assets can be funded (including part exchange) 3. Explain the accounting treatment for recording the acquisition and disposal of fixed assets and

the need for, and methods of, providing for depreciation on them. 4. Describe the contents and use of the fixed asset register. 5. Explain the accounting treatment of accruals and prepayments to expenses and revenue. 6. Explain the reasons for, and method of, accounting for irrecoverable debts and allowances for

doubtful debts


Unit 307 Principles of Accounts Preparation Outcome 4 Understand the need for, and the process involved

in, the preparation of final accounts

Assessment Criteria The learner can: 1. Identify reasons for closing off accounts and producing a trial balance 2. Explain the process, and limitations, of preparing a set of final accounts from a trial balance 3. Describe the methods of constructing accounts from incomplete records 4. Provide reasons for imbalances resulting from incorrect double entries. 5. Provide reasons for, and give examples of, incomplete records arising from insufficient data and

inconsistencies within the data provided.


Unit 308 Extending the trial balance using accounting adjustments

Level: 3 Credit value: 3 NDAQ number: M/600/4932 Unit aim This unit aims to introduce the learner to accounting adjustments for closing stock, accrued and prepaid expenses and income, and how these are incorporated into a trial balance. Provisions for depreciation to fixed assets, irrecoverable debts and allowances for doubtful debtors are also calculated and accounted for. Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Account for adjustments 2. Prepare a trial balance 3. Complete the trial balance Guided learning hours It is recommended that 25 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit FA-4. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.



Outcome 1 Account for adjustments

Assessment Criteria The learner can: 1. Identify correctly items of expenses and income and accurately adjust each for accruals and

prepayments 2. Record accurately the journal entries for closing stock. 3. Record accurately the journal entries for accrued and prepaid expenses and income 4. Record accurately the journal entries for provision for depreciation, irrecoverable debts and

allowances for doubtful debts. 5. Make relevant journal entries to close off revenue accounts in preparation for the transfer of

balances to the final accounts



Outcome 2 Prepare a trial balance

Assessment Criteria The learner can: 1. Prepare and use ledger accounts and reconcile where appropriate, identifying any

discrepancies and taking appropriate action to remedy these 2. Accurately account for a range of adjustments, including:

• closing stock • accruals and prepayments to expenses and income • provisions for depreciation on fixed assets • irrecoverable debts • allowance for doubtful debts

3. Prepare accurately a trial balance



Outcome 3 Complete the trial balance

Assessment Criteria The learner can: 1. Prepare the trial balance after adjustments. 2. Check for errors and/or inaccuracies in the trial balance and take appropriate action to remedy

these.


Unit 309 Principles of Costing

Level: 3 Credit value: 4 NDAQ number: M/600/4946 Unit aim This unit is about understanding principles of costing. Learners will be able to identify why cost accounting is an important tool within an organisation. They will be able to recognise different approaches to cost accounting and make informed and reasoned judgements to guide management. Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Demonstrate an understanding of the role of costing within the organisation 2. Advise on the most appropriate costing methods to use within an organisation 3. Understand the principles of using costing as a decision making tool Guided learning hours It is recommended that 35 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit MA-2. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 309 Principles of Costing Outcome 1 Demonstrate an understanding of the role of

costing within the organisation

Assessment Criteria The learner can: 1. Explain the purpose of internal reporting and providing accurate information to

management in terms of decision making, planning and control. 2. Explain the relationship between the various costing and accounting systems within an

organisation. 3. Identify the responsibility centres, cost centres, profit centres and investment centres within an

organisation. 4. Explain the characteristics of different types of cost classifications and their use in costing.


Unit 309 Principles of Costing Outcome 2 Advise on the most appropriate costing methods to

use within an organisation

Assessment Criteria The learner can: 1. Identify the most appropriate methods of stock control and valuation 2. Identify costs and the correct classification

• fixed • variable • semi-variable • stepped.

3. Identify the differences between marginal and absorption costing. 4. Identify the bases of allocating and apportioning indirect costs to cost centres

• direct • step down methods.

5. Identify the bases used for absorption, and the reasons for their use • machine hours • labour hours.

6. Identify the most appropriate costing system • job • batch • unit • process • service

7. Recognise stock in its various stages • raw materials • part-finish goods (work in progress) • finished goods.


Unit 309 Principles of Costing Outcome 3 Understand the principles of using costing as a

decision making tool

Assessment Criteria The learner can: 1. Explain the effect of changing activity levels on unit costs. 2. Explain the principles of discounted cash flow. 3. Identify the considerations affecting short-term decision making using

• relevant costs • break-even analysis • margin of safety • target profit • profit-volume analysis • limiting factors.

4. Identify the considerations affecting long-term decision-making using • payback • discounted cash flow.


Unit 310 Principles of Cash Management

Level: 3 Credit value: 2 NDAQ number: R/600/4938 Unit aim This unit is about understanding the principles of managing cash balances and deficits within an organisation. The learner will be able to advice on the options available to raise finance, and the options available for investment of surplus cash. The learner will be able to offer advice that is without detriment to the cash flow of normal business activities, and without risk to the organisation. Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Understand how the external environment impacts on how an organisation manages cash

assets 2. Be able to make informed decisions regarding the management of cash balances within an

organisation 3. Understand a range of accounting and other business techniques used to improve the efficiency

of cash management procedures within an organisation Guided learning hours It is recommended that 15 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit TM-1. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 310 Principles of Cash Management Outcome 1 Understand how the external environment impacts

on how an organisation manages cash assets

Assessment Criteria The learner can: 1. Explain how government monetary policies affect an organisation’s treasury functions. 2. Explain how recording and accounting practices may vary in different parts of the organisation. 3. Describe how an organisation’s principles of cash management will be determined by their

specific financial regulations, guidelines and security procedures. 4. Identify statutory and other regulations relating to the management of cash balances in

different types of organisations.


Unit 310 Principles of Cash Management Outcome 2 Be able to make informed decisions regarding the

management of cash balances within an organisation

Assessment Criteria The learner can: 1. Identify the characteristics of the main types of cash receipts and payments of

• regular revenue receipts,

• capital receipts,

• exceptional receipts and payments,

• drawings. 2. Explain how an organisation can raise finance from a bank through overdrafts and loans, and

the basic terms and conditions associated with each of these types of financing. 3. Explain different types of investment, the risks and terms and conditions associated with

them, including: • certificates of deposit, • government securities, • local authority short term loans, • shares.


Unit 310 Principles of Cash Management Outcome 3 Understand a range of accounting and other

business techniques used to improve the efficiency of cash management procedures within an organisation

Assessment Criteria The learner can: 1. Identify the component parts of cash budgets and how these are presented to aid decision

making. 2. Explain the effects of lagged receipts and payments upon an organisation‘s cash management. 3. Describe the relationship between cash flow accounting and accounting for income and

expenditure. 4. Identify the principles of liquidity management. 5. Explain techniques that can be used for estimating future trends

• moving averages • allowance for inflation.

6. Identify the ways to manage risk and exposure when investing, to minimise potential losses to the organisation.


Unit 311 Accounting for fixed assets

Level: 3 Credit value: 2 NDAQ number: Y/600/4942 Unit aim This unit aims to introduce the learner to recording and accounting for fixed assets. The learner will be able to record both purchase and disposal of a fixed asset, identifying any gains or losses made on disposal and be able to calculate and apply depreciation by a given method. Learning outcomes There are four learning outcomes to this unit. The learner will be able to: 1. Account for the purchase of fixed assets 2. Account accurately for depreciation 3. Account for the disposal of fixed assets 4. Take appropriate action when dealing with issues arising from fixed asset records Guided learning hours It is recommended that 15 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit based on the FSSC NOS for Accountancy and Finance Unit FA-4. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 311 Accounting for fixed assets Outcome 1 Account for the purchase of fixed assets

Assessment Criteria The learner can: 1. Identify correctly all items of capital expenditure 2. Calculate total capital expenditure including all associated costs 3. Record the prior authority for the capital expenditure 4. Record in the appropriate accounts the acquisition of a fixed asset funded by

• cash purchase • part exchange

5. Accurately record the acquisition in a fixed asset register 6. Close off or transfer the ledger account balances at the end of the financial period


Unit 311 Accounting for fixed assets Outcome 2 Account accurately for depreciation

Assessment Criteria The learner can: 1. Calculate the depreciation charges for a fixed asset using

• straight line method • reducing balance method

2. Record the depreciation in the fixed asset register 3. Record depreciation in the appropriate ledger accounts 4. Close off the ledger accounts at the end of the financial period, correctly identifying any

transfers to the profit and loss account


Unit 311 Accounting for fixed assets Outcome 3 Account for the disposal of fixed assets

Assessment Criteria The learner can: 1. Identify the correct asset and remove it from the fixed asset register 2. Correctly record in the appropriate accounts the disposal of the fixed asset 3. Correctly calculate any gain or loss arising from the disposal and close off or transfer the

account balance.


Unit 311 Accounting for fixed assets Outcome 4 Take appropriate action when dealing with issues

arising from fixed asset records

Assessment Criteria The learner can: 1. Identify and resolve, or refer to an appropriate person any queries, unusual features or

discrepancies relating to the accounting records for fixed assets.


Unit 312 Spreadsheet Software

Level: 3 Credit value: 6 NDAQ number: J/502/4626 Unit aim This is the ability to use a software application designed to record data in rows and columns, perform calculations with numerical data and present information using charts and graphs. This unit is about the skills and knowledge required by an IT user to select and use a wide range of advanced spreadsheet software tools and techniques to produce, present and check complex and non-routine spreadsheets. Spreadsheet software tools and techniques will be described as ‘advanced’ because:

• the range of data entry, manipulation and outputting techniques will be complex and non-routine;

• the tools, formulas and functions needed to analyse and interpret the required information require complex and non-routine knowledge and understanding (for example, data restrictions, data validation using formula, pivot tables, data maps); and

• the user will take full responsibility for setting up and developing the functionality of the spreadsheet.

Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Use a spreadsheet to enter, edit and organise numerical and other data 2. Select and use appropriate formulas and data analysis tools and techniques to meet

requirements 3. Use tools and techniques to present, and format and publish spreadsheet information Guided learning hours It is recommended that 45 hours should be allocated for this unit, although patterns of delivery are likely to vary. Details of the relationship between the unit and relevant national standards This unit is linked to the Unit maps fully to competences outlined in IT User National Occupational Standards version 3 (2009) See http://nos.e-skills.com for examples of content and context applicable to this unit Support of the unit by a sector or other appropriate body This unit has been developed by e-skills. Assessment This unit will be assessed by:

• See IT User Assessment Strategy available from www.e-skills.com


Unit 312 Spreadsheet Software Outcome 1 Use a spreadsheet to enter, edit and organise

numerical and other data

Assessment Criteria The learner can: 1. Identify what numerical and other information is needed in the spreadsheet and how it should

be structured 2. Enter and edit numerical and other data accurately 3. Combine and link data from different sources 4. Store and retrieve spreadsheet files effectively, in line with local guidelines and conventions

where available


Unit 312 Spreadsheet Software Outcome 2 Select and use appropriate formulas and data

analysis tools and techniques to meet requirements

Assessment Criteria The learner can: 1. Explain what methods can be used to summarise, analyse and interpret spreadsheet data and

when to use them 2. Select and use a wide range of appropriate functions and formulas to meet calculation

requirements 3. Select and use a range of tools and techniques to analyse and interpret data to meet

requirements 4. Select and use forecasting tools and techniques


Unit 312 Spreadsheet Software Outcome 3 Use tools and techniques to present, and format

and publish spreadsheet information

Assessment Criteria The learner can: 1. Explain how to present and format spreadsheet information effectively to meet needs 2. Select and use appropriate tools and techniques to format spreadsheet cells, rows, columns

and worksheets effectively 3. Select and use appropriate tools and techniques to generate, develop and format charts

and graphs 4. Select and use appropriate page layout to present, print and publish spreadsheet

information 5. Explain how to find and sort out any errors in formulas 6. Check spreadsheet information meets needs, using IT tools and making corrections as

necessary 7. Use auditing tools to identify and respond appropriately to any problems with spreadsheets


Unit 313 Professional Ethics in Accounting and Finance

Level: 3 Credit value: 3 NDAQ number: K/600/4962 Unit aim This unit is about recognising the importance of the ethical duties of an accounting technician. Learners will know how to work within the code to ensure that the public can gain a level of confidence in accounting practices or functions, and to protect their own and their organisation’s professional reputation and integrity. Learning outcomes There are three learning outcomes to this unit. The learner will be able to: 1. Understand the principles of ethical working in accountancy or payroll 2. Know how to behave in an ethical manner when working with internal and external customers 3. Understand when and how to take appropriate action following any suspected breaches of

ethical codes Guided learning hours It is recommended that 30 hours should be allocated for this unit, although patterns of delivery are likely to vary. Support of the unit by a sector or other appropriate body This unit is endorsed by the FSSC. Assessment This unit will be assessed by workplace assessment, as specified in the FSSC Accountancy and Finance Assessment Strategy 2009.


Unit 313 Professional Ethics in Accounting and Finance Outcome 1 Understand the principles of ethical working in

accountancy or payroll

Assessment Criteria The learner can: 1. Explain the general principles of ethical behaviour including

• integrity (including honesty)

• objectivity

• professional and technical competence and due care

• confidentiality

• professional behaviour. 2. Summarise the relevant legal, regulatory and ethical requirements affecting the accounting and

finance sector and your own industry 3. Explain the role of professional bodies relevant to your work 4. Explain why you, your organisation or industry are expected to operate within codes of conduct

and practice 5. Explain how organisations can be at risk from improper practice and why it is important to be

vigilant 6. Identify opportunities to maintain your continuing professional development in line with the

requirements of relevant professional bodies.


Unit 313 Professional Ethics in Accounting and Finance Outcome 2 Know how to behave in an ethical manner when

working with internal and external customers

Assessment Criteria The learner can: 1. Explain how to act appropriately and with integrity, honesty, fairness and sensitivity when

working with clients, suppliers, colleagues and others. 2. Identify why it is important to keep a professional distance between professional duties and

personal life at all times 3. Explain why it is important to adhere to organisational and professional values, culture, codes of

practice and regulations at all times. 4. Explain why it is important to adhere to policies for handling clients’ monies. 5. Explain why information should be kept confidential. 6. Identify circumstances when confidential information should be disclosed and who is entitled to

the information. 7. Explain the importance of working within the limits and confines of your own professional

experience, knowledge and expertise 8. Summarise the advice to clients on the retention of books, working papers and documents


Unit 313 Professional Ethics in Accounting and Finance Outcome 3 Understand when and how to take appropriate

action following any suspected breaches of ethical codes

Assessment Criteria The learner can: 1. Identify the relevant authorities and internal departments to who unethical behaviour, breaches

confidentiality, suspected illegal acts or other malpractice should be reported. 2. Recognise when the relevant authority should be advised if an employee has concerns over

work they have been asked to complete 3. Identify any inappropriate client behaviour and how to report it to the relevant authority. 4. Explain the procedures which should be followed if an employee suspects an employer,

colleague or client has committed, or may commit, an act which is believed to be illegal or unethical e.g. Whistle blowing


Appendix 1 Sources of general information

The following documents contain essential information for centres delivering City & Guilds qualifications. They should be referred to in conjunction with this handbook. To download the documents and to find other useful documents, go to the Centres and Training Providers homepage on www.cityandguilds.com. Providing City & Guilds qualifications – a guide to centre and qualification approval contains detailed information about the processes which must be followed and requirements which must be met for a centre to achieve ‘approved centre’ status, or to offer a particular qualification. Specifically, the document includes sections on: • The centre and qualification approval process and forms • Assessment, verification and examination roles at the centre • Registration and certification of candidates • Non-compliance • Complaints and appeals • Equal opportunities • Data protection • Frequently asked questions. Ensuring quality contains updates and good practice exemplars for City & Guilds assessment and policy issues. Specifically, the document contains information on:

• Management systems • Maintaining records • Assessment • Internal verification and quality assurance • External verification. Access to Assessment & Qualifications provides full details of the arrangements that may be made to facilitate access to assessments and qualifications for candidates who are eligible for adjustments in assessment. The centre homepage section of the City & Guilds website also contains useful information such on such things as:

• Walled Garden Find out how to register and certificate candidates on line

• Qualifications and Credit Framework (QCF) Contains general guidance about the QCF and how qualifications will change, as well as information on the IT systems needed and FAQs

• Events Contains dates and information on the latest Centre events

• Online assessment Contains information on how to register for GOLA assessments.

http://www.cityandguilds.com/�

Useful contacts

UK learners General qualification information

T: +44 (0)844 543 0033 E: [email protected]

International learners General qualification information

T: +44 (0)844 543 0033 F: +44 (0)20 7294 2413 E: [email protected]

Centres Exam entries, Registrations/enrolment, Certificates, Invoices, Missing or late exam materials, Nominal roll reports, Results


Single subject qualifications Exam entries, Results, Certification, Missing or late exam materials, Incorrect exam papers, Forms request (BB, results entry), Exam date and time change

T: +44 (0)844 543 0000 F: +44 (0)20 7294 2413 F: +44 (0)20 7294 2404 (BB forms) E: [email protected]

International awards Results, Entries, Enrolments, Invoices, Missing or late exam materials, Nominal roll reports


Walled Garden Re-issue of password or username, Technical problems, Entries, Results, GOLA, Navigation, User/menu option, Problems


Employer Employer solutions, Mapping, Accreditation, Development Skills, Consultancy

T: +44 (0)121 503 8993 E: [email protected]

Publications Logbooks, Centre documents, Forms, Free literature

T: +44 (0)844 543 0000 F: +44 (0)20 7294 2413

If you have a complaint, or any suggestions for improvement about any of the services that City & Guilds provides, email: [email protected]

Published by City & Guilds 1 Giltspur Street London EC1A 9DD T +44 (0)844 543 0000 F +44 (0)20 7294 2413 www.cityandguilds.com City & Guilds is a registered charity established to promote education and training

WW-02-7437

http://www.city-and-guilds.co.uk/�

level 3 diploma in accounting (7437-03) providing cost and revenue information a/600/4951 3 4 ......

Documents