UNIT II Topic: Audit and Accounting.

Text A: What is accounting Text B: The work of accountants. Text C: What is auditing Grammar: Modal Verbs

I. Practise the pronunciation of the following words:

a) stress the first syllable:

measuring, budget, checkbook, income, assets, revenue, turnover, vital, stockholder, agency, challenge, owner, banker, creditor, monetary, record, huge, data, summarize, merchandise, balance, inventory, entity, phase, maintenance, forecast, adequacy;

h) stress the second syllable:

account, accounting, accountant, accountable, describing, interpreting, expense, example, society, returns, supply, financial, outsider, include, investor, device, extend, incur, transaction, event, diverse, entire, involve, decision, executive, mechanical, repetitive, proficient.

II. Before you read the text answer the following questions:

1. What do you know about accounting? How old is it?

2. What role does accounting play in our economic and social life?

3. What does the study of accounting give every educated person?

III. Read and memorize the words and word-combinations:

account — бухгалтерський рахунок

accountant — 1) бухгалтер, рахівник 2) кваліфікований бухгалтер 3) ревізор, контролер

Certified Public Accountant (CPA) — (AE) дипломований бухгалтер вищої кваліфікації; аудитор

Chartered Accountant (CA) — (BE) сертифікований (дипломований) бухгалтер; бухгалтер-експерт

Certified General Accountant (CGA) — дипломований бухгалтер і аудитор

Certified Management Accountant – дипломований бухгалтер з менеджменту

accounting — 1) облік, бухгалтерський облік; 2)облікова справа; 3)ведення бухгалтерських книг

accounting concept — концепція (поняття, принцип) бухгалтерського обліку

adequacy — відповідність, адекватність

assets and liabilities — активи і пасиви

bookkeeping – ведення бухгалтерських книг

data — дані

earnings per share — дохід на одну акцію

entity — економічна одиниця, об’єкт, самостійний господарчий підрозділ, організація,

to extend — надавати (позику, тощо)

to file – надавати документ

income tax returns — декларація про прибутковий податок

to incur — нести (збитки); брати на себе (втрати)

interpreting — тлумачення

inventory turnover – коефіцієнт обігу (обороту) товарно-матеріальних запасів

to keep track - слідкувати, стежити, відстежувати

maintenance — збереження, утримання, додержання

outsider — аутсайдер (особа або підприємство, які не належать до монопольного об’єднання)

IV. Text a What is accounting

Some people think of accounting as a highly technical field which can be understood only by professional accountants. Actually, nearly everyone practises accounting in one form or another on an almost daily basis. Accounting is the art of measuring, describing, and in­terpreting economic activity. Whether you are preparing a household budget, balancing your checkbook, preparing your income tax return, or running General Motors, you are working with accounting concepts and accounting information.

Accounting has often been called the «language of business.» Such terms as assets, liabilities, revenue, expense, cash flow, inventory turnover, and earnings per share are but a few examples of technical accounting terms widely used in the business community. Every inves­tor, manager, and business decision maker needs a clear understanding of accounting terms and concepts.

The accounting function is vital to every unit of our society. An individual must account for his or her income, and must file income tax returns. Often an individual must supply personal accounting informa­tion in order to buy a car or home, to qualify for a college scholarship, to secure a credit card, or to obtain a bank loan. Large corporations are accountable to their stockholders, to governmental agencies, and to the public. Therefore, some knowledge of accounting is needed by all citizens if they are to act intelligently in meeting the challenges of our society.

The purpose of accounting is to provide financial information about an economic entity to decision makers. Business executives and manag­ers need the financial information provided by an accounting system to help them plan and control the activities of the business. For example, management needs answers to such questions as the profitability of each department of the business, the adequacy of the company's cash position, and the trend of earnings. Thus, accounting is the connecting link between decision makers and business operations.

Financial information about the business is also needed by out­siders. These outsiders include owners, bankers, other creditors, potential investors, labour unions, the government, and the public, because all these groups have supplied money to the business or have some other interest in the business.