The speaking module

II. Speaking Exercises:

Exercise 1. Describe bookkeeping; accounts; auditing using the suggested words and expressions:

bookkeeping involve, recording, transactions, mechanical process, demand financial training

accounts classify, summarize, provided, bookkeepers, interpret, report, management

auditing area, practice, remains, many firms

Exercise 2. Ask questions to the given answers:

1) Question: ___________________________________________ ?

Answer: Much of the information is contained in the annual report, a yearly statement of the financial condition and progress of the organization.

2) Question: ___________________________________________ ?

Answer: These external users are interested in the organization`s profits, its ability to pay its bills, and other financial information.

3) Question: ___________________________________________ ?

Answer: When a company wants to borrow funds from a bank or have its stock listed on a stock exchange, it must present statements regarding its financial affairs.

The writing module

III. Writing exercises:

Exercise 1. Complete the sentences with the suggested words:

About; of; in; with; in accordance; of.

An audit is a CPA`s examination _______ a company`s financial statements _______ order to express an opinion _______ the fairness _______ those statements _______ _______ with generally accepted accounting principles.

Exercise 2. Compose a story on one of the topics (up to 100 words):

“Financial accounting”

“Bookkeeping is an important part of accounting”

“Auditing”

Lesson 3 the reading module Read the text: What is an audit?

An audit is a process for testing the accuracy and completeness of information presented in an organization's financial statements. This testing process enables an independent certified public accountant (CPA) to issue what is referred to as an opinion on how fairly the agency's financial statements represent its financial position and whether they comply with generally accepted accounting principles (GAAP). GAAP is determined by the American Institute of Certified Public Accountants (AICPA). Board members, staff, and their relatives cannot perform audits because their relationship with the organization compromises their independence.

The audit report is addressed to the board of directors as the trustees of the organization. The report usually includes the following:

A cover letter, signed by the auditor, stating the opinion, as described above.

The financial statements, including the statement of financial position (balance sheet), statement of financial activity (income statement), and statement of cash flows. Health and social service organizations also have a statement of functional expenses. Many audits show comparative information between fiscal years.

Notes to the financial statements, as required by GAAP, which might include information about functional expenses, a depreciation schedule, further information about contributions, volunteer services, and other significant information not obvious in the financial statements.

In addition to the materials included in the audit report, the auditor often prepares what is called a management letter or report to the board of directors. This report cites areas in the organization's internal accounting control system which the auditor evaluates as weak.