中南财经政法大学会计学院 School of Accounting, Zhongnan University of Economics & Law 中级会计学(英文) 课程 (Intermediate Accounting) 教学大纲 (SYLLABUS) 《中级财务会计》教学小组编写 Teaching Team of Intermediate Accounting 2006年2月修订 (Feb.2006) Course Nature This course is designed for undergraduate students majoring in accounting and auditing. It is arranged in the fourth or fifth semester. It is aimed to enhance students’ ability both in western accounting knowledge and professional English, and to improve competitive for their job. The teaching content and arrangements of this course should be strictly according to this teaching outline. Teaching Objective After finishing learning this course, the students are required to understand the fundamenta western accounting theory, accounting concepts and the procedures and skills in dealing with the preparation of financial statements. By comparing the major differences of accounting treatment between U.S.A and China, the students are required to make comments on Chinese and US accounting standards and make research on them. Teaching Content Lesson 1 THE ENVIRONMENT OF FINANCIAL REPORTING Forewords I. Accounting information: users, uses, and GAAP in U.S.A. 2. The development of accounting standards in U.S.A. 2.1 Brief history of development of accounting standards – CAP, APB, FASB 2. 2 Financial Accounting Standards Board (FASB) 2.2.1 Organization 1.2.2 Statements issued by FASB 3. Other organizations currently influencing GAAP in U.S.A. 3.1 SEC, AICPA, EITF, CASB, IRS, AAA, IASC/IASB, GASB, professional organizations 3.2 Relationship of organizations in current standard setting environment 4. Ethics in the accounting environment 5. Comparison of the development of accounting standards in China and in U.S.A. (Case) Lesson 2 FINANCIAL REPORTING: ITS CONCEPTUAL FRAMEWORK 1. FASB conceptual framework 1.1 General value of framework 1.2 Nature and components of the FASB’s conceptual framework 2. Objectives of financial reporting 3. Qualitative characteristics of accounting information 3. 1 Hierarchy of qualitative characteristics 3.2 Pervasive constraint: benefits > cost 3.3 Primary decision-specific qualities. 3.3.1. Relevance 3.3.2. Reliability 3.4 Secondary decision-specific qualities- Comparability and consistency 3.5 Threshold for recognition: materiality. 4. Accounting assumptions and conventions 4.1 Assumptions-- Entity, Continuity (going-concern), Period of time, Monetary unit 4. 2 Conventions-- Historical cost, Realization and recognition, matching and accrual accounting, Conservatism (prudence) 5. Elements of financial statements 5.1 Balance sheet – Asset, Liability, Equity 5.2 Income statement – Revenue, Expenses, Gains, Losses 5. 3 Statement of cash flows—Operating cash flows, Investing cash flows, Financing cash flows 5.4 Statement of changes in equity—Investment by owners, Distribution to owners 6. Comparison of accounting concepts in China and in U.S.A. (Case) Lesson 3 THE BALANCE SHEET AND STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY 1. Interrelationship of financial statements 2. Elements of the balance sheet 3. Measurement of the elements of the balance sheet 4. Reporting classifications on the balance sheet 4. 1 Asset and liability classifications 4. 2 Conceptual guidelines for reporting assets and liabilities 4. 3 Stockholders' equity classifications 5. Limitations of the balance sheet 6. Statement of changes in stockholders' equity II Other disclosure issues 8. Reporting techniques 9. Balance Sheet analysis Lesson 4 THE INCOME STATEMENT AND INCOME RECOGNITION 1. Concepts of income 1. 1 Capital maintenance 1. 2 Transactional approach 2. Elements of the income statement 3. Income statement content 3.1 Income from continuing operations 3.2 Results from discontinued operations 3.3 Extraordinary items 3.4 Effects of accounting changes 3.5 Earnings per share 4. Income statement formats 4.1 Single-step 4.2 Multiple-step 5. Limitations of the income statement 6. Income Statement analysis 7. Comprehensive income 8. Conceptual issues of revenue recognition 8.1 Revenue recognition criteria 8.2 E conomic substance versus legal form 8.3 Transfer of risks and benefits 8.4 Collectibility of receivable 9. Revenue recognition alternatives 9.1 Normal revenue recognition 9. 2 Revenue recognition prior to the period of sale 9. 3 Revenue recognition after the period of sale Lesson 5 THE STATEMENT OF CASH FLOWS Conceptual overview and uses of the Statement of Cash Flows Structure of the Statement of Cash Flows 2.1 Three categories of cash flows. 2.2 Supplemental disclosures Reporting Cash Flow From Operations Operating cycle Two methods 3.2.1 Direct method-- Illustration 3.2.2 Indirect method-- Illustration Preparing a complete Statement of Cash Flows A six-step process for preparing a statement of cash flows. Using cash flow data to assess financial strength Chapter 6 CASH AND RECEIVABLES I. Accounting for cash 1.1 Measurement as a current asset 1.2 Cash and cash equivalents 1.3 Cash management 1.4 Petty cash system 2. Bank reconciliation 3. Special topics 3.1 Electronic funds transfer systems 3.2 Compensating balances 4. Receivables 4.1 Classifications 4.1.1 Current vs noncurrent 4.1.2 Trade receivables 4.1.3 Nontrade receivables 4.2 Valuation issues 4.2.1 Initial recording based on expected future cash flows 4.2.2 Estimation of the probability of collection 5. Accounts receivable 5. 1 Cash (sales) discounts 5.2 Sales returns and allowances 6. Valuation of accounts receivable for uncollectible accounts 6.1 Estimated bad debts method 6.1.1 Income statement approach 6.1.2 Balance sheet approach 6.2 Recording bad debts 6.3 Writing off uncollectible accounts 6.4 Collection of an account previously written-off 6.5 Direct write-off method 7. Generating immediate cash from accounts receivable 7.1 Conceptual issues 7.2 Pledging 7.3 Assignment 7.4 Factoring of receivables 7.5 Disclosure of financing agreements 8. Notes receivable (short-term) Lesson 7 INVENTORIES 1. Classifications of inventory III. Alternative inventory systems 2. 1 Perpetual 2. 2 Periodic 3. Items to be included in inventory quantities 4. Determination of inventory costs 4.1 Items included in inventory cost. 4.2 Discounts as reductions in cost. 4.3 Purchase returns and allowances. 4.4 Summary 5. Inventory valuation methods 5. 1 Specific identification 5. 2 First-in, first-out (FIFO) 5. 3 Average cost 5. 4 Last-in, first-out (LIFO) 5. 5 Comparison 6. Inventory valuation at other than cost 6. 1 Lower of cost or market (LCM) 6. 1.1 Application of LCM 6.1.2 Conceptual evaluation of ceiling and floor 6.1.3 Approaches to applying LCM 6.1.4 Recording the reduction of inventory to market 6.1.5 LCM and interim financial statements 6.1.6 Conceptual evaluation of LCM 6.2 Gross profit method 6.3 Retail inventory method 7. Effects of inventory errors Lesson 8 PROPERTY, PLANT, AND EQUIPMENT 1. Classification as property, plant, and equipment (PPE) 1.1 Characteristics 1.2 Evaluation of use of historical cost 2. Acquisition of PPE 3. Assets acquired by exchange of other assets 3.1 Definition of nonmonetary exchange 3.2 Dissimilar productive asset exchanges 3.3 Similar productive asset exchanges 3.4 Comparison of accounting treatments in China and in U.S.A. (Case) 4. Self-construction 4.1 Interest during construction 4.2 Fixed overhead costs 5. Costs subsequent to acquisition 6. Disposal of property, plant, and equipment 7. Disclosure of property, plant, and equipment 8. Depreciation and depletion 8.1 Cost allocation terms 8.2 Factors involved in depreciation 8.3 Methods of cost allocation 8.4 Conceptual evaluation of depreciation methods 8.5 Disclosure requirements for depreciation 8.6 Depreciation for partial periods 8.7 Depletion 9. Impairment of noncurrent assets 9.1 Impairment test 9.2 Measurement of loss 9.3 Conceptual evaluation Lesson 9 INTANGIBLES 1. Accounting for intangibles 1.1 Cost 1.2 Amortization or impairment 2. Research and development (R&D) 2.1 Definitions 2.2 Costs included as R&D 2.3 Cost treatment 2.4 Conceptual evaluation of accounting for R&D costs 3. Identifiable intangible assets 4. Unidentifiable intangibles 5. Disclosure of intangibles 5.1 In period intangible assets are acquired 5.2 In each period company presents a balance sheet 6. Conceptual evaluation of accounting for intangibles Lesson 10 CURRENT LIABILITIES AND CONTINGENCIES 1. Conceptual overview of liabilities 2. Nature and definition of current liabilities 2.1 Liquidation expected within a year or an operating cycle, whichever is longer 2.2 Liquidity and financial flexibility 2.3 Classification 3. Valuation of current liabilities 4. Current liabilities having a contractual amount 5. Current liabilities whose amounts depend on operations 6. Current liabilities requiring amounts to be estimated 7. Contingencies 7.1 Definition in FASB Statement No. 5 7.2 Accrual of loss contingencies 7.3 Disclosure of loss contingencies in notes to financial statements 7.4 Disclosure of gain contingencies in notes to financial statements 8. Other liability classification issues 8.1 Short-term debt expected to be refinanced 8.2 Classification of obligations that are callable by the creditor 9. Presentation of current liabilities in the financial statements Lesson 11 LONG-TERM LIABILITIES AND RECEIVABLES 1. Reasons for issuance of long-term liabilities 2. Bonds payable 2.1 Terms 2.2 Bond selling prices 2.3 Recording the issuance of bonds 2.3.1 Premium on bonds payable: adjunct account 2.3.2 Discount on bonds payable: contra account 2.3.3 Carrying (book) value 2 4. Bonds issued between interest payment dates 2.5 Amortizing discounts and premiums 2.5.1 Straight-line method 2.5.2 Effective interest method 3. Extinguishment of liabilities 3.1 Bonds retired at maturity 3.2 Bonds retired prior to maturity 4. Bonds with equity characteristics 5. Long-term notes payable 5. 1 Notes payable issued for cash 5. 2 Notes payable exchanged for cash and rights or privileges 5.3 Notes payable exchanged for property, goods, or services 5.4 Disclosure of long-term liabilities Lesson 12 INVESTMENTS 1. Investments: classification and valuation 1.1 Trading securities 1.2 Available-for-sale securities 1.3 Held-to-maturity debt securities 1.4 Definitions 2. Investments in debt and equity trading securities 3. Investments in available-for-sale debt and equity securities 3.1 Recording initial cost 3.2. Recording interest and dividend revenue 3.3 Recognition of unrealized holding gains and losses 3.4 Realized gains (losses) on sales of securities available-for-sale 4. Investments in held-to-maturity debt securities 4.1 Recording initial cost 4.2 Recognition and amortization of bond premiums and discounts 4.2.1 Methods 4.2.1.1 Effective-interest method 4.2.1.2 Straight-line method 4.2.2 Premium amortization reduces investment account 4.2.3 Discount amortization increases investment account 4.3 Amortization for bonds acquired between interest dates 4.4 Sale of investment in bonds before maturity 5. Transfers and impairments 5.1 Transfers of investments between categories (at fair value) 5.2 Impairments 6. Disclosures 7. Financial statement classification 8. Equity method 8.1 Criteria for use 8.2 Accounting procedures 8.3 Financial statement disclosures Lesson 13 CONTRIBUTED CAPITAL 1. Introduction 2. Corporate capital structure 2.1 Definitions 2.2 Capital stock and stockholders' rights 2.3 Basic terminology 2.4 Legal capital 2.5 Additional paid-in capital 3. Issuance of capital stock 3.1 Issuance for cash 3.2. Stock issuance costs 3.3 Stock subscriptions 3.4 Combined sales of stock 3.5 Nonmonetary issuance of stock 3.6 Stock splits 3.7 Stock rights to current stockholders 4. Preferred stock characteristics 4.1 Preference as to dividends 4.2 Cumulative vs. noncumulative 4.3 Participating 4.4 Preference in liquidation 4.5 Voting rights 4.6 Disclosures 5. Contributed capital section 5.1 Segments 5.2 Disclosure requirements Lesson 14 EARNINGS PER SHARE AND RETAINED EARNINGS 1. Earnings and earnings per share 2. Conceptual overview and uses of earnings per share information 3. Basic earnings per share 3.1 Basic earnings per share equation 3.2 Numerator calculations 3.2.1 Noncumulative preferred stock 3.2.2 Cumulative preferred stock 3.3 Denominator calculations 3.4 Components of earnings per share 4. Diluted earnings per share 4.1 Definitions 4.2 Two presentations 4.2.1 Basic earnings per share 4.2.2 Diluted earnings per share (DEPS) 4.3 Computational steps 4.4 Stock options and warrants 4.5 Convertible securities 4.6 Computation of tentative and final DEPS 5. Content of retained earnings 6. Dividends 6.1 Cash dividends 6.2 Property dividends 6.3 Scrip dividends 6.4 Stock dividends 6.5 Liquidating dividends 7. Prior period adjustments 8. Appropriations of retained earnings 9. Statement of retained earnings 9.1 Prior period adjustments 9.2 Net income 9.3 Dividends 9.4 Other deductions 10. Accumulated other comprehensive income Teaching Arrangement 1 Time allocation The total class hour is 51, with 3 scores. Lectures in class are divided into 4 teaching units. The time allocation for each teaching unit is as follows: Teaching Unit Basic Content Time allocated  Part 1 Financial Reporting: Concepts, Finanicial Statements, and Related Disclosures 1 The Environment of Financial Reporting 2 Financial Reporting: Its Conceptual Framework  8   3 The Balance Sheet and the Statement of Changes in Stockholders’ Equity 4   4 The Income Statement and income recognition  6   5 The Statement of Cash Flows  5  Part 2 Financial Reporting: Asset Measurement and Income Determination 6 Cash and Receivables  4   7 Inventories 3   8 Property, Plant, and Equipment 4   9 Intangibles 3  Part 3 Financial Reporting: Valuation of Liabilities and Investments 10 Current Liabilities and Contingencies 4   11 Long-Term Liabilities and Receivables  3   12 Investments  3  Part 3 Financial Reporting: Stockholders’ Equity 13 Contributed Capital 14 Earnings Per Share and Retained Earnings  4  Total   51  2 Teaching methods This course mainly adopts lecture in class, with the help of multimedia. We also allocates some presentations after group discussion out of classroom. It is taught either in English or in the combination of both English and Chinese. 3. Exam form and requirements After finishing the course, it will be tested in English, no matter the course is taught in English or in the combination of both English and Chinese. Normally , it adopts the close book test , if applied and allowed by the officers, it could be tested in other form according to the situation. The formats of the final exam paper includes multiple choice, translation both from English to Chinese and from Chinese to English , identification of true of false, case analysis writing, making journal entries, calculation, preparation of the worksheet for the financial statements , preparation of balance sheet, income statement and cash flow statements, and the analysis of the financial statements, ect. 4. Scoring system It adopts 100% scoring system. The final score consists of 2 parts, one is the score of the final exam, the other is the score of daily performance, which including assignment, attendance and discussion performance etc. The proportion of this two parts depends on the requirement of university. Teaching Materials 1. Textbook 《中级会计学》（高等学校会计学类英文版教材），高等教育出版社，2005年1月第1版 (Intermediate Accounting, 9E, by Loren A. Nikolai John D. Bazley) 2. References A. 《中级会计学》（会计类原版教材影印系列），中国财政经济出版社，2002年11月第1版(Intermediate Accounting, 14E, by Earl Kay Stice, James D. Stice, K. Fred Skousen ) B. Statements of Financial Accounting Standards, by FASB C. International Accounting Standards / International Financial Reporting Standards D. Chinese Accounting Standards for Enterprises 3. Related intenet web sites A. FASB www.fasb.org B. IASB www.iasb.org C. the Nikolai and Bazley Intermediate Accounting web site http://Nikolai.swcollege.com ）