ACCOUNTING AND ACCOUNTANTS – MYTH AND REALITY

Overview

1. What is Accounting? Myth vs. reality

2. Professional bodies and qualifications

3. Core skills of future accountants

4. What accountants do

a) Financial Accounting

b) Management Accounting

c) Taxation

d) Auditing

1. What is Accounting? Myth vs. reality

Myth #1: Accounting = Bookkeeping

• Not true!!!!!!

• Bookkeepers typically perform data entry tasks

  • Typically do not have a college degree; might have a Diploma

• Accountants take over where bookkeepers leave off

  • Spend most of their time in a decision-making capacity

  • Assist company management to understand financial impact of business decisions

  • Typically have at least a degree; are often Professional Accountants

ACCOUNTING IS THE LANGUAGE OF BUSINESS

• But …..

  • You will have to start somewhere after you graduate

  • You will need to pick up the basics

• It is not fully a myth at the beginning of your career

  • It is good to build up your foundation

Not True!!!   Would you consider the following careers boring?

Myth #2: Accounting is boring

1. A corporate entertainment accountant. Work for a studio, production company or a record company. Oversee production costs, budgets for movies, concerts, tours, etc.  Watch the credits at the end of a movie.

2. A world traveler.  An accountant with an global accounting Firm or Multinational Corporation that has offices all over the world.

3. A Forensic Accountant with law enforcement agencies.  Love to solve mysteries?  Could be called in on legal investigations involving finances or financial crimes. Analyze financial statements or decipher complicated money-laundering transactions. Who brought down Al Capone?

4. A Chief Financial Officer (CFO) for a Fortune 500 company like Wal-Mart, Ford Motor, Microsoft, Procter & Gamble, Owens-Corning, etc.

5. A Tax Accountant.  Work in public accounting, industry, or government (Inland Revenue Board or Customs).

6. An IT Auditor.  The high-tech sleuth.  Blend of accounting and technology – in high demand.  Ensure that a company’s cyber security is reliable.

7. A Plant Controller.  Determine how much it really costs to make a product.

8. Government Accountant.  Work for federal, state, or local government in various roles. (Accountant General’s department, Auditor General office etc.)

9. Finance Director for a not-for-profit entity.

10. Auditor of companies in an audit firm.

2. Professional bodies and certifications

• Chartered Institute of Management Accountants (ACMA/FCMA)

• Chartered Global Management Accountant (CGMA)

• Association of Chartered Certified Accountants (ACCA/FCCA)

• Institute of Chartered Accountants of England and Wales (ACA/FCA)

• CPA Australia (CPA/FCPA)

• Malaysian Institute of Accountants (CA Malaysia)

• Malaysian Institute of Certified Public Accountants (CPA)

• Institute of Singapore Chartered Accountants (CA Singapore)

3. Core skills of future accountants

• Ability to interpret and provide context to financial and non-financial information

• Communication and leadership

• Strategic and critical thinking

• Customer/client/market focus

• Technologically adept

• Numeracy Skills

• Attention to Detail

• Organisation Skills and Time Management Skills

• General business knowledge

• Information technology expertise

• Communication skills

• Leadership abilities

• Customer service orientation

4. What accountants do – Stuff that appears to be boring

a) Financial accounting

• Preparation of financial statements and other financial reports.

• Preparation and review of balance sheet reconciliations.

• Preparation of asset, liability, and capital account entries.

• Documentation of financial transactions.

• Provision of financial information to management.

• Processing of customer payments and balancing accounts.

• Еntering of vendor invoices into the system and communicating with vendors.

• Complex research and analysis of specific accounts.

• Providing professional accounting advice and assistance.

• Analyse business operations, trends, and costs.

b) Management accounting

• preparing periodic financial statements, including profit and loss accounts, budgets, cash flows, variance analysis and commentaries

• providing a support service by working with all departments and the management team to help make financial decisions

• ensuring spending is kept in line with the budget

• informing key strategic decisions and formulating business strategies

• advising on the financial implications and consequences of business decisions

• analysing financial performance and contributing to medium and long-term business planning and forecasts

• negotiating on major projects, loans and grants

• interpreting and communicating financial data to non-financial managers

c) Taxation

• Malaysia Corporate Tax

  • Preparation of schedules to support the completion of tax forms and returns

  • Checking computations of tax payable

  • Ensuring all possible deductions have been utilised

  • Checking of cross-border transactions to avoid anti-transfer pricing legislation

• Goods & Services Tax (GST), Sales and Service Tax (SST)

  • Explanation of the practical workings of GST/SST

  • Analyse the impact of GST/SST on major supplies and acquisitions

  • Identify major contracts which may be adversely affected

  • Analyse major systems requiring process improvement

d) Auditing

An independent examination and evaluation of financial records or financial statements of an organisation.

• Internal audit

  • Ongoing audit function carried in a company by a internal auditing department staffed by employees appointed by management.

  • Review the organisation’s operational activities and report on its effectiveness with suggestions for improvement as per management requirements.

• External audit

  • Audit function performed by an independent firm of auditors appointed by the members or shareholders of the company.

  • Analyse and verify the financial statements of the company and report on its truthfulness and fairness as per statutory requirements.

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