- •Starter асtivities
- •2. What financial components does the balance sheet contain?
- •Vocabulary focus
- •Opening inventory
- •Factory overheads
- •Interest costs
- •Cost of sales
- •Task 3. Read the text again and answer the questions.
- •B. Answer the following questions taking in account the data above.
- •Listening
- •Writing
- •2.000 2,000
- •Lower, reduce, make, list, raise, have, use
- •B. Insert the correct verb forms in the following sentences.
- •Case study
- •Test yourself
- •Vocabulary
- •Starter activities
- •1. When is a business considered to operate with profit?
- •Vocabulary focus
- •1.____________
- •Reading and discussion
- •Further speech practice
- •Planning for cash flow
- •Consolidated profit and loss account
- •Grammar focus
- •Test yourself
- •Accounting ratios
- •Vocabulary
- •Inland Revenue and Customs and Excise
- •Vocabulary focus
- •Fig. 1. Table of ratios
- •Reading and discussion task 1. Read the text and fill in the following chart.
- •Review of accounting ratios
- •Overall performance ratio
- •Profitability ratios
- •Productivity ratios
- •1St year 2nd year
- •Liquidity ratio
- •Investment ratio
- •Capital structure ratio
- •Trading and profit and loss accounts for the year ended 31 December
- •Balance sheets as at 31 December
- •Reference materials
Vocabulary focus
TASK 1. Match the phrase on the left with the definition on the right.
|
1)profit |
a) |
the difference between sales revenue and the costs of the |
|
|
|
goods which were sold |
|
2)gross profit |
b) |
the final profit after adding any other revenues and |
|
|
|
deducting any other expenses |
3)
|
net profit |
c) |
total value of production in one year |
4)
|
turnover |
d) |
same as gross profit |
5)
|
overall gross |
e) |
the difference between the revenue earned by a business |
|
profit |
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and the expenses consumed in earning that revenue |
TASK 2. Give your versions to finish the sentences below.
1. Auditors are supposed to make sure that companies follow their stated____.
2. Companies can choose from a variety of ___but they are not allowed to change them too often.
3. Lots of money obtained in dubious or illegal ways is deposited in __
____in Swiss banks.
4. The basic ____is Assets = Liabilities + Owners' Equity.
5. The ____at the London Stock Exchange usually lasts two weeks. It is
followed by an ____on which all bills must be settled.
6. The ______ is one of the three basic financial statements.
7. ___ consist of money that is expected to be received. The contrary,___consist of money that is owed to other people.
8. The role of____is to provide figures and statements that will aid decision-making.
TASK. 3. Classify the words in the box into four groups, according to the headings below.
Accounts payable |
Net profit |
Amortization |
Posting | |||
Annuity system |
Prudence |
Below the line |
Reducing balance | |||
Income-statement |
Reserves |
Deferred |
Straight line | |||
|
|
liabilities |
method | |||
Double-entry |
Separate-entry |
Going-concern |
Scrap value | |||
Consistency |
Trial balance |
Journal |
Unit-of-measure | |||
Ledger |
Writing off |
Matching |
Voucher | |||
Bookkeeping |
Accounting Principles |
Depreciation |
Financial Statements | |||
|
|
|
|
TASK 4. Which of the words in Task 9 above do the following sentences define.
1.____________
A term to describe "extraordinary" items placed after the net profit total in a profit and loss account, which perhaps make the profit appear higher than it really is.
2.____________
A way of depreciating an asset which involves estimating the number of years it will be used, and then dividing its historical cost by this number.
3._________
Money that a company will definitely have to repay in the future, but not during the current financial year.
4._________
The accounting principle which assumes that a business will still be functioning next year and thereafter.
5.__________
The American name for the entry on a balance sheet that shows how much money a business owes its suppliers for purchases made on credit.
6.___________
The American name for what in Britain is usually called a profit and loss account.
7._________
The accounting principle that requires multinational companies to produce consolidated balance sheets in a single currency.
8.________
The part of a company's profit that is retained for future reinvestment, rather than distributed as a dividend.
TASK 5. Replace underlined words by synonyms given below.
The income statement is used to compare income and expense results with the pro forma targets for the period for which it was prepared. By evaluating the income statement results it is possible to compare actual results to pro-forma targets and make improvements as needed.
The period usually lasts for one year. This is the period of time statement. It lists the accounting period and the date it was finished. Most income statements are for 12 months, beginning the month the business began and lasting for a year. This makes easier accounting and tax planning.
The cost of the goods sold is subtracted, resulting in a gross margin. From this gross profit the current expenses are subtracted and the balance is called net profit.
Net profit usually includes the owner's or owners' salary as well as the return on investment. A company to work successfully owners have to find ways to increase sales or reduce expenses.
a) performance |
b) |
income |
c) revenue |
d) covered |
e) is running |
J) |
covered |
g) profitably |
h) completed |
i) target set |
j) |
operating |
k) simplifies |
I) adjustments |
TASK 6. Complete the following passage using the words from the box.
The financial information in the balance sheets used by___1___to tell the shareholders the return on their capital. This is the amount of___2____expressed as a___3___of the capital invested in the company. The___4___who provided the capital are interested in_5_which are paid out of the profits.
The capital of the company consists of fixed assets and current assets minus ____6___
To calculate___7___you work out what the net profit was as the percentage of the capital.
But the___8____given at the end of the year was__9___during the year, while the figure for the capital___10___is what it was at the end of the year. So, to be more accurate, we should work out the___11___of capital employed for the year. This can be done by taking____12___at the beginning and the end of the period and taking the average.
a) current liabilities |
b) profit |
c) dividends |
d) net profit |
e) shareholders |
f) figures |
g) employed |
h) managers |
i) the return on the capital |
j) earned |
k) average |
1) percentage |
TASK 7. Find one word for each numbered gap.
a) forecasts b) meetings c) summary d) money e) Auditor's
f) activities g) shareholders h) dividends i) coming j) five
k) required I) annual m) Accounts n) position o) auditing
p) share operations
A. Each year the Office Computers publishes its Annual Report and (1)
____for the financial year. The report begins with a statement to the (2)
_____by the chairperson. In it he or she reviews the results of the past
year and (3)____what will happen in the (4)____year. (Note that a company in Britain can start its financial year in any month and so (5)_____work is spread evenly throughout the year.)
Next comes the Board of Directors' report which is (6)____by low. This
gives an account of the (7)______of each director, of the group, of the
group's employment policy and of (8)_____given to political parties and
charities.
The (9)_____Accounts report to shareholders on the financial results of
the group's (10)_______during the past year and show the financial (11)
______at the end of the year. The accounts are followed by the (12)_____Report and include the following reports:
• Consolidated Profit and Loss Account
• Consolidated Balance Sheet
• Cash flow statement
• Statement of Accounting Policies
• Notes to the Accounts
The document also includes a (13)___-of the financial results for the
past (14) _____ years and gives general information about the company's (15) ______ capital and the timetable for shareholders'
(16)______and the payment of (17)________.
Extract from the Chairman's statement.
I am pleased to report a satisfactory____1____of your company in the year just ended.____2____before tax increased by 18 per cent to £425 million and ____3___per share increased by per cent to 3.5 pence. Your Board has___4 dividends for the year amounting in total to 10.5p per share, an increase of 13.5 per cent on the____5___year. The growth in profits___6____the continuing progress in rationalizing the business, more stable trading conditions at home and substantial ____7____in our program for diversification.
In our major export___8____, we face fierce competition which depresses our earnings and threatens the profitability of our___9___new product the office desktop JDI. Your___10___is actively seeking fresh overseas markets to ___11____the Office Computers position as major international supplier.
a) announced b) earnings c) reflects d) profit
e) advances f) performance g) earnings h) major
i) consolidate j) previous k) markets 1) Board
TASK 8. Translate the word combinations with Participles. The first two are done for you. Give sentences of your own with some of them (not less than 10).
employed capital -применяемый капитал falling price -падающая цена
limited company maintaining policy
increased sales increasing turnover
achieved increase operating expenses
money paid in time remaining money
reduced margin people running the company
invested funds engineering company
profit made last year proposing solutions
finished goods working capital
unsold stocks rising overheads
TASK 9. Make up word combinations, which help you speak about the main tasks of a financial manager. Use them in sentences of your own.