Accounting

1. Read the following words and word combinations and learn their meanings by heart:

accounting	бухгалтерський облік
an accountant	бухгалтер
an account	рахунок
a financial status/condition	фінансовий стан
an executive	керівник
business transactions	угоди
a nonprofit organization	некомерційна організація
to measure	вимірювати
to record	записувати, реєструвати
relevant financial data	відповідна фінансова інформація
a financial report/statement	фінансовий звіт
a bookkeeping	бухгалтерський облік
a bookkeeper	бухгалтер (рахівник)
a trial	перевірка
to match	збігатись

2. Read and translate the text into Ukrainian.

Accounting is the preparation and analysis of financial records for a commercial company, government, or other organization. Accounting enables decision-makers to interpret financial information and use the results in planning for the future. For example, such data tell executives which products or departments are doing well and which poorly.

Business people use accounting data in communicating about a firm’s activities. Information provided by accountants helps managers and other executives understand the results of business transactions and interpret the financial status of their organization. With this knowledge, managers can make informed decisions about such matters as production, marketing and financing. Charities, churches, colleges, government agencies, and other nonprofit making organizations also use accounting to measure their financial performance.

So the aim of accounting is to show a financial condition of a company. It is an accounting department of a firm that records and measures all relevant financial data of its business activity.

Financial reports are the central feature of accounting because they are the primary means of communicating important accounting information to users. They, so to say, show business in financial terms.

If money is often referred to as “the blood of business”, accounting is referred as the “the language of business”.

Accounting is sometimes confused with a related activity called bookkeeping. In general, a bookkeeper records daily business transactions and periodically do a trial to see if both sides of an account book match. Accountants, however, analyse financial records and decide how to present them. It is a special art to prepare the relevant meaningful financial report from the given data. In short, accountants make financial information understandable for users.

Exercise 1. Find English equivalents of the following words from

the text and memorize them:

бухгалтерський облік; аналіз фінансових записів; тлумачити фінансову інформацію; діяльність фірми; керівники; угоди; фінансовий стан; благодійні організації; некомерційні організації; вести записи та вимір відповідної фінансової інформації; фінансові звіти; споріднена діяльність; робити перевірку; збігатися; користувачі.

Exercise 2. Complete the sentences from the text.

1. Accounting is ... . 2. Accounting enables decision-makers to ... . 3. Business people use accounting data in communicating about ... . 4. Information provided by accountants helps managers and other executives understand ... . 5. So the aim of accounting is to show ... . 6. It is an accounting department of a firm that ... . 7. Financial reports are ... . 8. If money is often referred to as “the blood of business”, accounting is referred ... . 9. Accounting is sometimes confused with ... . 10. In general, a bookkeeper records ... . 11. Accountants, however, analyse ... .

Exercise 3. Answer the questions:

1. What is accounting?

2. What does accounting enable decision makers to do?

3. How does information provided by accountants help managers and other executives?

4. What is the aim of accounting?

5. What department records and measures all relevant financial data of business activity?

6. What is the central feature of accounting?

7. What is the difference between accounting and bookkeeping?

Exercise 4. Speak on the topic:

- accounting and its aim for business.

Exercise 5. Act out the dialogue on the basis of the following

assignment:

Your friend is interested in accounting. He is going to study it. Speak about accounting.

Text 2

Fields of accounting

1. Read the following words and word combinations and learn their

meanings by heart:

to handle	опрацьовувати
cost accounting	розрахунковий бухгалтерський облік
to draw up	скласти
determining	визначення
expenses	видатки
overheads	накладні витрати
a maintenance	підтримка
an efficiency	ефективність
to assist	допомагати
undertaking	ручатися
returns	дохід
a court ruling	судове управління
to evaluate	оцінювати
an accuracy	точність

2. Read and translate the following text.

Accountants may be classified by the type of organization for which they work. For example, business accountants are employed by all types of companies. A small firm may have one general accountant who handles all financial records. But a large corporation may employ large numbers of accountants for the various duties involved.

Organizations or individuals may hire professional accountants for occasional tasks or special accounting services.

Most accountants specialize in a field of accounting. The mayor fields include budget accounting, cost accounting, management accounting and tax accounting. Accountants who specialize in a field called auditing review the work of accountants in other fields.

Budget accounting consists of drawing up a budget for the expected future activities of an organization during a certain period. Budget accountants base their work on the organizations most recent financial reports and on projections of future conditions and activities.

Cost accounting deals with determining the expenses involved in producing and selling a product or service. Among these expenses are the wages paid to a company׳s employees, the cost of the materials needed, and overheads. Overheads include all other cost, such as heat, light, power, and maintenance of machinery.

Management accounting involves recommending ways to improve an organization׳s operating policies and increase its efficiency. For example, a management accountant may assist managers in deciding the best method of undertaking a mayor project, such as the purchase of a factory. Many accountants work for companies that provide management consulting services. A business firm hires such accountants to study its system of management and recommend changes.

Tax accounting consists of preparing tax returns for organizations or individuals and determining the taxes involved in proposed business transactions. Tax accountants suggest ways to save money in taxes. They must have a thorough knowledge of the tax laws that affect their clients or employers. Tax accountants also need to know the details of court ruling in a wide variety of tax cases.

Auditing involves the examination of the accounting records of an organization or an individuals. Auditors evaluate the accuracy of these records and whether they have been prepared using generally accepted accounting principles.

Exercise 1. Find English equivalents of the following words from

the text and memorize them:

галузі бухгалтерського обліку; опрацьовувати фінансові записи; найняти; розрахунковий бухгалтерський облік; переглядати; складати бюджет; визначення витрат: опалення; підтримка обладнання; ефективність; допомагати.

Exercise 2. Complete the sentences from the text.

1. Accountants may be classified by … . 2. A small firm may have one … . 3. Organizations or individuals may hire professional … . 4. Most accountants specialize in … . 5. The mayor fields include … . 6. Budget accounting consists of … . 7. Cost accounting deals with … . 8. Overheads include … . 9. Management accounting involves … . 10. Tax accounting consists of … . 11. Tax accountants suggest ways to … . 12. Auditing involves … . 13. Auditors evaluate … .

Exercise 3. Answer the questions:

1. What accountant may have a small firm?

2. What field do most accountants specialize in?

3. What are the major fields of accounting?

4. What does budget accounting consist of?

5. What does cost accounting deal with?

6. What does management accounting involve?

7. What does tax accounting consist of?

8. What does auditing involve?

Exercise 4. Speak on the topic:

- the major fields of accounting.

Exercise 5. Act out the dialogue on the basis of the following

assignment:

Your friend is interested in fields of accounting. Speak about major fields of accounting.

Text 3

Bookkeeping

1. Read the following words and word combinations and learn their meanings by heart:

to summarize	підсумовувати
profit	дохід
loss	збиток
an asset account	рахунок активу
a liability account	рахунок пасиву
an equity account	рахунок капіталу
an income account	рахунок доходу
an expenditure account	рахунок витрат
assets	засоби
inventory	товарно-матеріальний запас
liabilities	зобов’язання
claims	вимоги
to owe	володіти
wages	заробітна плата
mortgages	закладні
an equity	загальна вартість
a contributed capital	внесений капітал
retained earnings	нерозподілений прибуток
a nominal account	номінальний рахунок
a double-entry bookkeeping	система подвійного запису
to reverse	змінюватися протилежно
an equation	рівняння
equal	рівні (однакові)

2. Read and translate the text into Ukrainian.

Bookkeeping is the systematic process of analysing, recording, and summarizing the economic transactions of a business or other organization over a given period. Organizations and individuals use bookkeeping because it provides orderly and accurate information about their financial transactions. It gives a picture of the financial position, and records the changes in profit, or loss making, which are taking place.

Bookkeepers record all economic transactions in accounts. The three basic types of accounts are asset accounts, liability accounts and equity accounts. There are also income (or revenue) accounts and expenditure accounts.

Assets are the resources used by an organization. An organization usually owns its assets, which include cash, inventory, supplies, land, buildings, and equipment. Separate accounts are kept for the various types of assets. Liabilities are claims of creditors such as debts owed by an organization. They include accounts payable, wages payable, and mortgages payable, and are generally recorded on separate liability accounts. Equity consists of the claims of owners. Such claims include contributed capital and retained earnings. Income and expenditure accounts are sometimes called nominal accounts. They are considered part of the equity of the organization.

The most commonly used bookkeeping system is called double-entry bookkeeping. In this system, every business transaction is recorded in two entries, and every account has two sides. One side is the debit side, and the other is the credit side. Each side has columns for dates, explanations of any changes, and the amount of money involved.

For asset account, the beginning balance and all increases are recorded on the debit side. Decreases are recorded on the credit side. This procedure is reversed for liability and equity accounts. That is, the beginning balances and all increases are shown on the credit side, and any decreases are recorded as debits. Most transactions in income accounts are reflected as credits. Most transactions in expenditure accounts are debits.

The fundamental equation in double-entry bookkeeping is Assets = Liabilities + Equity. A transaction can affect this equation in many different ways. But the two sides of the equation must always balance each other, - that is, they must be equal.

Note:

debts owed by an organization – борги, які винна організація

Exercise 1. Find English equivalents of the following words from

the text and memorize them:

аналіз, запис та підсумовування економічних угод; забезпечувати точну інформацію; дохід; збиток; рахунок активу; рахунок пасиву; рахунок капіталу; рахунок доходу; рахунок витрат; засоби; товарно-матеріальний запас; окремі рахунки; зобов’язання; вимоги; борги, які винна організація; заробітна плата; закладні; загальна вартість; внесений капітал; номінальні рахунки; система подвійного запису; приріст; зменшення; змінюватися протилежно; рівняння.

Exercise 2. Complete the sentences from the text.

1. Bookkeeping is the systematic process of ... . 2. It gives a picture of the financial ... . 3. Bookkeepers record all economic transactions in ... . 4. The three basic types of accounts are ... . There are also ... . 5. Assets are ... . 6. Liabilities are ... . 7. Equity consists of ... . Such claims include ... . 8. The most commonly used bookkeeping system is called ... . In this system, every business transaction is recorded in two ... . 9. For asset account, the beginning balance and all increases are recorded on ... . Decreases are recorded on ... . 10. Most transactions in income accounts are reflected as ... . Most transactions in expenditure accounts are ... . 11. The fundamental equation in double-entry bookkeeping is ... . 12. The two sides of the equation must always … .

Exercise 3. Answer the questions:

1. What is bookkeeping?

2. How is bookkeeping used by organizations

and individuals?

3. How do bookkeepers record all economic transactions?

4. What basic types of accounts do you know?

5. What are assets and what do they include?

6. What are liabilities and what do they include?

7. What does equity consist of?

8. What system of recording is used in bookkeeping?

9. How are increases and decreases recorded?

10. How are most transactions reflected in income

and expenditure accounts?

11. What fundamental equation in double-entry bookkeeping

do you know?

Exercise 4. Speak on the topics:

- the meaning of bookkeeping for organizations and

individuals;

- basic types of accounts;

- double-entry system.

Exercise 5. Act out the dialogue on the basis of the following

assignment:

Your friend is going to study bookkeeping. Speak about principles of bookkeeping.

Text 4