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Friday, 27 November 2015

Accounting 101: A Review

Introduction -- I'm Asleep

I'm not sure how closely you've been paying attention but I'm generally fairly disparaging about accounting. This is twofold. One, I'm not interested in accounting and two, I have a habit of looking down my nose at what I've termed "technical" subjects. Also, everyone, it seems, does accounting (and/or finance which gets on my nerves too... remember aside from having possibly failed economics 201, I'm a budding economist). Anyway, what I am trying to say is that I wasn't looking forwards to taking accounting 101 and, with a little help from my friends, I put it down for semester one 2015 (so, a while ago now, yeah?). Needless to say I wasn't pumped and this matters because one's expectations of something inform one's experience... and if you're reading my review you've got to know where it's coming from, right?

Aim

I think the aim is centred more around making sure that people have a basic introduction to the two parts of accounting (management and financial) and finance. The course is, in fact, structured like that. However, it is known as "Accounting Information" for a reason: the emphasis is very much on understanding information and, particularly in the financial section, the calculations one does are geared towards assisting in that understanding or in helping understand how the information comes to exist.

Model: What Does Accounting 101 Look Like?

Well, I pretty much just answered this in vague terms, didn't I?

Accounting 101 (essentially) starts off with management accounting. This bit I found more interesting because it's where the more useful stuff, for non-investors, happens. That is to say, preparing budgets and costing. In fact, I quite like costing and I'm not going to lie to you: part of that is because I'm pretty certain that Deloitte was involved in the Business Cases for several transport ideas (and that means costing). At any rate, there's a reason why the management section often worked with the textbook's case study of someone starting up their own business (something to do with chocolate, Sweet Temptations?). 

Financial Accounting is what actually put me to sleep. Seriously, turning to the back of the coursebook time after time to look at reams of tables is not my idea of fun when those tables are relating to the financial performance of the Warehouse and the Airport. Also, if anyone knows what Goodwill is, please tell me. If that was explained in the course I have no idea when and was probably asleep at the time, yet it's a fairly important concept (but not for the textbook's contents page). Basically, financial accounting helps you decide how well a business is doing based on their financial statements. You learn how to read the statements, some things that help you analyse the statements (to figure out what they really mean) and why things are recorded in the way they are (see, for instance, net realisable value versus at cost).

Finally, Accounting 101 introduces the student to the department's other major: finance. Finance, as far as I remember, is based around this idea of the Time Value of Money. That is, a dollar today is worth more than a dollar tomorrow. This happens, one instinctively senses, because you can invest that dollar and get a return and also because of inflation. Accounting 101's version of finance is all about figuring out the future and or present value of different ideas. It's more interesting than financial mostly because it involves calculations that require a bit more thought than financial's ratios.

As you can possibly tell, I don't remember that much of the course. I note that here because I can't remember if we were looking at cash and some otehr form of accounting in management or financial. Cash, for reference, relates to how things are recorded and my suspicion is it was significant in both but the distinction probably mattered in finance 

Oh, and finally, the course comes with workshops. This is like your normal lecture but it's all working through problems. I seriously suggest doing them at home/beforehand and while you'll be a bit bored you will actually get more from this independent work. And, of course, if you're uncertain, the workshop will show you how to actually do it. Learning through doing.

Assessment

Accounting 101 has the bog standard test and exam combination expected of stage one business courses but it also has two assignments, several quizzes and some peerwise stuff and operates in a plussage environment.


Firstly, the test and exam are really what you would expect. The test covers, as far as I remember, everything up until it takes place while the exam covers simply everything (which means this course does plussage the right way). However, the test is nasty. The class average when I did it was a pitiful 20.5 out of 40. I seem to remember, way back in semester one 2014, my friends who were doing this course commenting on a very low mid semester test score. However, I am not sure if it was this course they were discussing. At any rate, I am pretty sure the course deliberately tries to have a nasty mid-semester test. However, I got 34/40, which is 85%. That's not because I am some accounting genius (and while I would argue that this course is pretty all right for people like me who have never done accounting... although I did read the earlier chapters of the textbook), indeed I managed 71/100 in the exam en route to a B+ (I had expected an A-; I think my MCQs worth three points each were answered less successfully than my expectation, for that section I got 30/42 or 71%). The reason why I think I did so well in the midsemester is simple. I think it was because I was second year and everyone else was a first year sitting one of (if not) their first tests, and I was familiar with how university tests work. Don't pay too much attention to the questions: do pay attention to how the questions are structured. What you want to do with uni resources is generalise them. Also, for me, since I knew that whatever happened in this course I was not continuing wth accounting, the pressure was always off: that probably helps. Thus, my advice: don't take accounting 101 in semester one of your first year if you are definitely not going to major in accounting or finance. On the other hand, I am sure that the secret to success in the exam probably relies on being more familiar with the course than I was. I can't quite remember but I am willing to bet I didn't go all out on my revision process.


The Assignments are pretty straightforward. The first is pretty easy while the second is tougher, at least if you haven't been paying too much attention to finance and you're prioritising roughly concurrent stage two assessments instead. Peerwise is very straightforward. Basically, one comes up with a multiple choice question, posts it to this website and then answers a few questions. Then one rinses and repeats for the second half of the semester. Congratulations, as long as you haven't plagiarised your question and it isn't completely stupid, you'll get the marks for this task. Oh, and you can submit and answer as many as you like, which means Peerwise can be a good way of revising the content. This is sort of true of the quizzes. There you have three attempts at the final quiz and practically as many as you like at the revision ones, which you can also use to practice for the final quizzes (there are ten quizzes all up). Personally, I didn't bother and as long as I got at least 7/10 I didn't bother repeating either (although that was for week six so maybe I didn't bother repeating because I was busy). Most of the time I got 8 or 9 on my first attempt and left it there. Since I barely managed a B+ (75.85 overall, which I only know because they recorded on my copy of my exam script my total exam mark) this didn't affect things.


As a final caution, my coursework mark was a pretty comfortable A- at 83.25 (so that's all the weighted coursework marks added together / the maximum weighted coursework mark of 40). To get an A- I needed 78% on the exam at a minimum (and if I'd repeated those quizzes and got 9/10 on all of them it'd have been only 76.75%). That's not particularly strenuous. Actually, given that two more MCQs would've meant I was at 36/42 there, the reason why I didn't get an A- was probably more that I dropped more marks in the short answers than I appreciated or, alternatively, the MCQ thing and having not repeated the quizzes. So, don't become complacent like me.


Content


This time I really have answered this so I will simply list the modules:


Introduction

Business Plan: C-V-P
Business Plan: Budgeting
Costing
Planning and Control Decisions
The Accounting System & Balance Sheet
The Accounting System & Income Statement
The Accounting System & Owner's Equity
Financial Statement Analysis
Time Value of Money
Capital Investment
Financial Management

Success

With the other courses I've listed my advice in this section primarily. However, with Business 101 I got an A, 102 an A-. Infosys returned an A- and Stats an A+. Now, a B+ wouldn't stop me from making advice, and as you have read, it has not. Indeed, if you ask me about Maths 150 (B-) or Maths 250 (C) then I'll give you advice on how to do better than me. I'm a bit cautious though about advising people about what works when I don't know if it'll work. I mean, I take no responsibility for what happens if you follow the advice on this blog (and while I think it is good advice, it is unreasonable for my blog to be one's only source advice) but I do want to provide advice that I think is good. So bear this in mind. I'm not speaking as someone who considers himself to have done well. I am speaking of someone who fell short of his self-imposed minimum standard, and who, in the past, has had a better foundation from which to make advice.


  • Don't Be Complacent -- just because you did well in the coursework, that doesn't mean that a bad exam is recoverable. For me this wasn't the case. Don't do what I did: don't be complacent.
  • Generalise Past Papers -- you're not looking for the questions per se when you look at these, what you are looking for is the way the questions are written, how the test/exam is structured so that you're prepared for the situation the paper puts you in. It's like how a cricket side will look at the pitch, determine it's good for batting, but won't make a prediction like "Oh, we should get to 400/2 easy". 
  • It's Not All Straightforward -- this was learnt by my poor assignment two: financial statement analysis is pretty boring and looks quite easy but it's not so easy when you actually get around to doing it. I said to my friends, "I intended to not do so well on A2, but not this badly and looking at the answers, I think I wouldn't have done too much better even if I had put a lot of effort into it rather than working on these other things".
  • However, the Content is Pretty Good -- I personally found the things in this course generally easy to wrap my head around. I thought that the workshops, at least if you came prepared, were helpful and there is a drop in centre or office hours for any questions that you may have (try to avoid going during assignment times as it gets busy). As I mentioned, the textbook is probably a good resource to help you get another perspective on something. And, there are always recordings if you want to hear something again.
  • Learning Through Doing -- even this course, about accounting information, is still pretty technical... how to do something. In this sense, what you've got to do is knuckle down and do the stuff for yourself. This was one of my big problems in Maths (both courses). It was one of the reasons why I have probably failed Economics 201 (didn't go to several tutorials or practice problems on my own). I'm not saying this will guarantee success, it didn't for me, but it will help a lot. Don't underestimate the gains that not being lazy bring.
  • Delay Taking Accounting 101 (if you know you won't do 102) -- Of all the courses for someone interested in majoring in, say, economics accounting is probably the least useful. The cost stuff can look kinda similar but you do that in eco itself. For prospective marketing majors, CVP does pop up, but you can, like I did, do ACCTG 101 and MKTG 201 concurrently. In fact, if you are completely certain, but only if you are completely certain, I think delaying ACCTG 101 is one of the best decisions you can make because you'll be more prepared for that test. On the other hand, if your friends are doing ACCTG 101, having a network of people who you know and can talk it over with does help too (some of my friends, for various reasons, did ACCTG 101 at the same time as me).
So, that's the main body of my advice. Notice a lot of it is formulated as "don't do". That is, in general, not as useful as advice as "do do". The thing is, given my B+ I don't feel like I know enough to have powerful "do dos". Hmm, that sounds a bit rude.

Conclusion -- But It's Not As Bad As I Thought

I was fully prepared to absolutely loathe accounting 101. However, I didn't. In fact, I probably, at the end of the semester, was enjoying it more than Economics 111 and maybe about the same, or more than, MKTG 201 (although those were both cases of lecturer fatigue, too much Gamini and I don't think Sandy's a particularly good lecturer*). In part this is probably because I liked my accounting 101 lecturer (Debbie) and the finance stuff I found far from dull. But also, being ready to loathe/expecting to hate also affects how you do experience something... maybe you're more willing to interpret the stuff you don't like as being the worst things eva!1!!1 or maybe it manifests as your expectations are exceeded that much more easily. Thus, perhaps it is fair to say if you're expecting to love this course you're probably going to be disappointed. 


That being said, just because I didn't end up hating Accounting 101 that doesn't mean that I didn't find it boring. Because, at times, I really really did. I don't know how asleep I would get but I was certainly far from aware enough to know what was going on. Maybe I slept a lot because I wasn't really very tired for most of last semester. Who knows? Not I.


Academically, I don't think it's the most stimulating subject. But, then, neither's MKTG 201 and I got a B+ in that too, in the same semester, so what do I know?


*Or, maybe, more accurately I simply never adjusted to her style enough to gain anything from it.

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