Английский язык для бухгалтерского дела. English for Accounting. Учебное пособие

The account in which profit is measured is called the trading and profit and loss account.

The section of the account in which gross profit is calculated is known as the trading section, while that in which net profit is measured is known as the profit and loss section.

A few points ought to be made about some accounts which often cause confusion.

Carriage inwards and carriage outwards

These are both expenses and therefore appear as debit balances in their ledger accounts. The first is the expense of paying for the transport of goods which have been bought for resale. The second describes the expense of transporting goods sold to the customers. They are treated slightly differently, however, in the trading and profit and loss account. Carriage inwards is added to the purchases in the trading section while carriage outwards is listed with all the other expenses in the profit and loss account.

Discounts allowed and discounts received

Discounts allowed to debtors for prompt payment are shown as an expense in the profit and loss section. Discount received from creditors are shown as income in the profit and loss account along with any other income such as rent received. Such incomes are usually positioned immediately below the gross profit.

Final accounts

The trading and profit and loss account and the balance sheet are often known as the final accounts because they are drawn up at the end of the financial year. Technically the balance sheet is not an account but a financial statement. You can normally assume, however, that when you are asked to prepare final accounts, a balance sheet is to be prepared as well.

Note: Inland Revenue - Налоговое управление Великобритании

СOMPREHENSION CHECK

I. Find Russian equivalents to the following English words and word combinations:

1.Profit and Loss Account

2.Gross profit

3.Net Profit

4.drawings

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5.meet the requirements

6.capital expenditures

7.revenue expenditures a. заимствования

b. расходы по капитальынм вложениям c. удовлетворять требованиям

d. чистая прибыль

e. отчёт о прибылях и убытках f. валовая прибыль

g. текущие расходы

II.Find synonyms among the following words and word combinations: owner, estimate, provide, revenue, expenditure, obtain, deduct,

compete, allow, decrease, transfer, proprietor, assess, give, income, spending, acquire, subtract, calculate, permit, reduce, carry out.

III.Say if the following statements are true or false.

1.The actual period of time chosen is not a major problem.

2.Most small businesess measure their profits monthly.

3.Profit is negative if earning are more than expenses.

4.Expenditure on all items can be regarded as revenue expenditure.

5.An extra account will be introduced when an owner makes frequent withdrawals from the business.

IV. Fill in the missing words from Text A.

The owner may decide to see how much......he has made in the... 6 month, 3months, week, day or… any period that he chooses.

The calculation is not especially difficult, - though the above definition does fail to make one … absolutely clear.

To answer the question correctly it is ... to you.... the distinction between capital and revenue expenditure.

Another transaction which … frequently and which must not be ... to affect the calculation of ... is the withdrawal of any of the assets ... the business by the ... for his private use.

The account in which profit is...is called the trading and profit and loss …

Discounts allowed to debtors for... payment are shown as an ... in the profit and loss section.

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The trading and profit and loss account and the … sheet are often known as the … accounts because they are drawn up ... the end of the ...

year.

V. Find the adjectives in the left column that describe the nouns in the right column.

Incurred Total Negative Small Fixed Private Debit Credit

VI. Find 6 words or word combinations defining the word “account” in Text A.

VII. Find the sentences with the Passive Contructions.

VIII. Define the functions of the verbs to do, to have, to be in the following sentences:

1.The calculation itself is not difficult - though the definition does fail to make one thing absolutely clear.

2.Gross profit is the difference between the revenue earned from sales and the cost of the goods sold.

3.When you are asked to prepare final accounts, a balance sheet is to be prepared as well.

4.The owners of all businesses have to pay taxes on their profits.

GRAMMAR GUIDE

Conditional Sentences

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I.Open the brackets. Use the necessary forms denoting unreality.

1.It was a wet day. If I not (to wear) my raincoat I (to be) wet to the skin.

2.Kate is such a comfort to me. If it not (to be) for her I (to feel) lost.

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3.You certainly came in time. If it not (to be) for you I (to lose) my temper.

4.I have not seen her since she was a child. If I (to see) her now I not (to know) her.

5.No one is likely to come now. But if anyone (to come) ask them to wait.

6.She looks awfully young for her years. If it not (to be) for her gray hair she (to look) about thirty.

7.The passage was not lighted. If the moon not (to shine) so brightly through the cob-webby windows we (to be) in total darkness.

8.All her things are here. If she (to go away) for good she (to take them). She intended to come back.

9.“You see”, the lady said, “if you not (to stuff) yourself with meat you (to be able) to eat a peach now”.

10.She was the moving spirit of the whole thing. Nothing (to be done) if it not (to be) for her.

11.Everything depended now on whether she had spoken the truth. If she (to lie) we (to be) lost.

Set Expressions Used to Denote Unreality:

a)would rather (sooner) + infinitive – denotes preference;

b)had better + infinitive – denotes advice. e. g. 1. I’d much rather walk.

Я бы охотней пошла пешком (сейчас).

2.She’d rather have stayed at home.

Она бы предпочла (тогда) остаться дома.

II. Paraphrase the following sentences.

Model: 1. She would prefer to stay here.

She’d rather stay here.

2.She would have preferred not to go there.

She’d have rather not gone there.

1.I should prefer not to make any decision now. Not before I know all the facts.

2.She would prefer to have dinner in bed.

3.They would have preferred to play football.

4.Would you prefer to have lunch at the canteen?

5.Mother would have much preferred to stay at home and watch television.

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6.Would you prefer to go through the letters now?

7.She would prefer not to discuss it in public.

8.He would prefer to do this himself. He likes doing jobs round the house.

Unreality in Simple Sentences

Such sentences express an unreal wish or show the speakers sorry something was done or not done in the past.

e. g. 1. If only I had his address.

Если бы у меня был его адрес (сейчас)!

2. If only I had not promised to do it.

Если бы я не пообещала (тогда) сделать это! or И зачем я пообещала сделать это!

III. Express an unreal wish concerning the following statements.

Model: 1. I don’t know him well enough.

If only I knew him better.

2.He will not be in time. If only he were in time.

1.She makes article mistakes.

2.She always comes late.

3.I forgot to wind my alarm-clock.

4.I don’t know who is responsible for it.

5.He will miss the train.

6.There is something the matter with her heart.

7.That dog keeps barking all through the night.

8.The show will be over by the time we come.

9.I’m not able to concentrate somehow.

10.They are coming today.

Sentence Patterns with the Conditional Mood

I(we) should do smth Smb would do smth

But for this _________________

I(we) should have done smth Smb would have done smth

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e. g. 1. But for her poor health she would be my best pupil.

Если бы не ее слабое здоровье, она была бы моей лучшей ученицей.

2. But for your help and understanding this book would have never been written.

Если бы не ваша помощь и сочувствие, эта книга никогда не была бы написана.

IV. Complete the following sentences. Use the present tense of the conditional mood to refer the sentence to the present or future. Use the past tense to refer it to the past.

Model: But for her nose, which is a little long -

1.she would be rather pretty (now)

2.she would have been rather pretty (then)

1.But for one difficult place the translation - .

2.But for her slightly trembling hands the girl - .

3.But for her accent she - .

4.But for the wind the day - .

5.But for his words we - .

6.But for the spelling mistakes the composition - .

7.But for one or two mistakes she made at the very beginning her report - .

8.But for me you - .

9.But for my headache I - .

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Read text B and do the tasks given after it. Ask questions on the

text for your partners to answer. Use the answers for making up a summary for text B.

Text B

WHAT DOES THE TERM “CASH FLOW” MEAN

The term tries to summarize the effects of all the inflows and outflows of cash which a business has. A business will have various sources of cash and will use that money in various ways, e.g. on running expences, buying machinery and vehicles and purchasing stock. If more

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cash is used in a given period than comes in, then the business might be said to have a poor cash flow. This will be reflected in the business′s cash balance, i.e. the money it actually holds in cash and has in its bank account - a poor cash flow will result in a fall in the cash balance.

What then are these sources of cash and uses of cash within a business?

Sources of cash

The list is as follows:

1.Share capital. The original cash for the company will come from the issue of shares; more shares could be issued to raise more money.

2.Borrowing money. Cash could be obtained in the form of loans, debentures, mortgages etc.

3.Trading profit. Cash will be generated from trading as the excess of cash received from sales over cash paid out on the expenses of operating the business. This is a very important source. The healthy company should be able to generate sufficient cash from trading to cover the majority of its uses - it would then be regarded as a company with a good cash flow.

4.Proceeds from the sale of fixed assets. Whilst not frequent transactions these can be major cash inflows. For example, in one year

Tesco Stores raised cash of £46,4 million through the sale of properties, in the same period generating £67, 2 million from trading.

5.Decreases in current assets. A company′s cash balance can be improved by reducing the amount of money which is tied up in other current assets. So by reducing stock levels, i.e. not replacing stock when it is sold, or by reducing the level of debtors (e.g. chasing them more vigorously for payment), the cash balance will increase whilst these other current assets will fall.

6.Increases in current liabilities. Here, for example, you might delay the payment of creditors and so retain cash in the business for a longer period. For example, if you owed trade creditors £10, 000 at the start of the year, bought goods to the value of £60, 000 during the year, and owed £15,

000at the end of the year, your cash balance would have benefited by £5,

000.You have only paid £55, 000 for goods purchased of £60,000.

Uses of cash

1.The repayment of borrowings - that is the loan itself; the payment of interest is a running expense of the business.

2.Trading losses - where cash paid for expenses is greater than the income from sales.

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3.The purchase of fixed assets.

4.Increases in current assets (e.g. investing more in stock).

5.Decreases in current liabilities.

Just to summarize this examination of cash flow we shall look at diagrammatic form. The top part of the diagramm contains the more constant sources and applications of cash. The lower section describes the flow of cash around the trading cycle of a business, whereby money will be paid to creditors for stock or stock may be bought and sold for cash. Expenses will be incurred in the course of trading which must be covered by sales income. Therefore the money which is received from debtors must be greater than that spent in buying stock and paying for expenses. All of this is what is covered by the term “cash flow” - the overall effect of the various sources and applications of cash on the cash balance of a business.

Notes: 1. inflow - приток (зд. денежной массы)

2.outflow - отток

3.to delay the payment - задерживать выплату

4.i.e. - (that is ) - то есть

5.proceeds - выручка, доходы

The cash flow of a business

I.Find the Russian equivalents to the English word combinations:

1.various sources

2.running expenses

3.cash balance

4.share capital

5.amount of money

6.sale of properties

7.to generate cash

8.payment of interest

9.incurred expenses

a. понесенные затраты

b. продажа собственности c. текущие расходы

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d. выплата процентов e. баланс наличности

f.различные источники

g.капитал акционеров

h.количество денег

i.получать деньги

II. Make up a list of key words for Text B.

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Translate Text C into Russian in writing in 45 minutes. Answer

the question: In what areas does the statement of cash flows summarize receits and disbursals of cash ?

Text C

A COMPANY′S INCOME STATEMENT

AND THE STATEMENT OF CASH FLOW

Some companies make money the old-fashined way: they earn it through their basic operations. Other companies resort to “extraordinary” or unusual measures – selling off assets, e.g., or changing the way they account for various items. Take Harris Corp., a $2 billion high technology company in Florida. In 1984 it reported income of $2.02 per share, a nice increase from $1.62 the year before. But a close look at the footnotes reveals eight unusual items, including the sale of real estate, which would normally be shown as separate items within a company′s income statements. If all eight items were to be substracted from Harris′s profits, the apparent increase in income would become a significant decline. Although there is nothing wrong with making money on a one-time transaction, there is generally a limit to how long a company can sustain a record of earning growth through such unusual means. A “healthy” track record may be an illusion if it is based on liquidation of assets or on a switch in accounting methods from one accounting period to the next.

In addition to preparing a balance sheet and an income statement, all public companies and many privately owned firms prepare a statement of cash flows. The Financial Accounting Standards Board (FASB - the chief rulemaking body for accountants) requires public companies to include

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