Principles of Accounts
PRINCIPLES OF ACCOUNTS
GENERAL OBJECTIVES
The aim of the Unified Tertiary Matriculation Examination (UTME) syllabus in Principles of
Accounts is to prepare the candidates for the Board’s examination. It is designed to test their
achievement of the course objectives, which are to:
1.
2.
3.
4.
5.
6.
Stimulate and sustain their interest in Principles of Accounts;
Use the basic knowledge of and practical skills in Accounting;
Apply the knowledge and interpretation of accounting information to decision making;
Determine the relevance of accounting information to business and governments;
Use information and communication technology for present and future challenges.
Use current accounting principles in financial reporting.
DETAILED SYLLABUS
TOPICS/CONTENTS/NOTES
OBJECTIVES
Candidates should be able to:
1. Nature and Significance of Accounting
a. Development of accounting (including i. differentiate between bookkeeping and accounting;
branches of accounting);
ii. use the historical background of
bookkeeping and
b. Objectives
accounting;
c. Users and characteristics of Accounting
information;
of
bookkeeping
and
accounting for future development;
iii. apply the right principles, concepts and conventions to
solving accounting problems;
iv. examine the role of accounting records and information
in decision making.
d. Principles, concepts and conventions of
accounting (nature, significance and v. list the branches of Accounting such as Cost
application); Accounting, Management Accounting, Auditing,
e. Role
of
accounting
records
and
Financial Accounting and Taxation.
information.
Candidates should be able to:
2. Principles of Double Entry
i.
relate the various source documents
to their uses;
a. Functions of source documents
b. Books of original entry
c. Accounting equation
ii. relate source documents to the various books of original
entry;
d. The ledger and its classifications
e. Trial balance
iii. determine the effect of changes in elements of
accounting equation;
f. Types and treatment of errors and uses
of suspense account
iv. identify the role of double entry and use it to post
transactions into various divisions of the ledger;
v. balance off ledger accounts;
vi. extract a trial balance from balances and determine its
uses;
vii. identify various types of errors and their necessary
corrections;
viii. create a suspense account.
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Principles of Accounts
TOPICS/CONTENTS/NOTES
3. Ethics in Accounting
OBJECTIVES
Candidates should be able to:
a. Objectives
b. Qualities of an Accountant
i.
use ethics in preparing and presenting Accounting
Reports;
ii. list qualities of an Accountant such as honesty,
integrity, transparency, accountability and fairness.
Candidates should be able to:
4. Cashbook
i.
determine the cash float;
a. Columnar cashbooks
b. Discounts
c. Petty cashbook and the imprest system
ii. differentiate between two and three columnar
cashbooks and how transactions are recorded in
them;
iii. differentiate between trade and cash discounts;
iv. examine the effects of trade and cash discounts in
the books of accounts.
v. identify various petty cash expense;
5. Bank Transactions and Reconciliation
Statements
Candidates should be able to :
i.
identify bank documents such as cheques, pay-in-slips,
credit and debit cards and their uses;
a. Instrument of bank transactions
b. e-banking system
ii. assess the impact of automated credit system, credit
transfers, interbank transfers and direct debit on cash
balances;
iii. list factors that cause discrepancies between balances
of cashbook and bank statements
c. Causes
of
discrepancies
between
cashbook and bank statement
d. Bank reconciliation statement
iv. prepare adjusted cashbook balance
v. prepare bank reconciliation statements.
6. The Final Accounts of a Sole Trader
Candidates should be able to:
a. Income statement (Trading and profit and
loss account)
b. Statement of financial position (Balance
sheet)
c. Adjustments:
i. determine the cost of sales, gross profit and net profit
of a sole trader;
ii. identify fixed assets, current assets, long- term
liabilities, current liabilities and proprietor’s capital;
iii. compute adjustable items on the related expenditure
and income in the profit and loss account;
iv. relate the adjustable items and their corresponding
disclosure in the statement of financial position;
v. differentiate between bad debts and provision for bad
and doubtful debts.
i.
provision for bad and doubtful debt
ii. provision for discounts
iii. provision for depreciation using straight-
line and reducing balance methods
iv. accruals and prepayments
7. Stock Valuation
Candidates should be able to:
i. determine the cost of materials issued to production or
cost of goods sold using FIFO, LIFO and simple
average;
a. Methods of cost determination using
FIFO, LIFO and simple average
b. The advantages and disadvantages of the
methods
ii. calculate the closing stock of materials or finished
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Principles of Accounts
TOPICS/CONTENTS/NOTES
OBJECTIVES
c. The importance of stock valuation
goods using FIFO, LIFO and simple average;
iii. compare the advantages and disadvantages of each
method of stock valuation;
iv. determine the effects of stock valuation on trading,
profits and cost of goods sold.
Candidates should be able to:
8. Control Accounts and Self-balancing
Ledgers
i. determine the importance of control accounts in a
business enterprise;
ii. differentiate between sales ledger control account and
purchases ledger control account;
a. Importance of control accounts
b. Purchases ledger control account
c. Sales ledger control account
iii.identify the individual elements of control accounts;
iv. prepare the control accounts
Candidates should be able to:
9. Incomplete Records and Single Entry
i. determine proprietor’s capital using statement of
affairs;
ii. determine the amount of sales, purchases, cash
balances, debtors, creditors and expenses by
converting single entry to double entry;
a. Conversion of single entry to double
entry
b. Determination of missing figures
c. Preparation of final accounts from
incomplete records
iii. use accounting equations and gross profit percentage
to determine gross profit or cost of sales.
Candidates should be able to:
10. Manufacturing Accounts
i. calculate prime cost, production overhead, production
cost and total cost;
a. Cost classification
b. Cost apportionment
c. Preparation of manufacturing account
ii. determine the basis of apportionment into production,
administration, selling and distribution.
Candidates should be able to:
11. Accounts
of Not-For-Profit-Making
Organizations.
i. distinguish between the features of Not-for-profit-
making organizations;
ii. determine the subscription income, subscription in
arrears and in advance;
iii. compute the cash balances and accumulated funds,
surplus and deficit for the period from all sources.
iv. Prepare:
a. Objectives
organizations
b. Receipts and payments account
c. Income and expenditure account
d. Statement of financial position (Balance
sheet)
of
Not-For-Profit-Making
a. receipts and payments account
b. income and expenditure account
c. statement of financial position
Candidates should be able to:
12. Departmental Accounts
i. identify the reasons for departmental accounts;
ii. determine the expenses associated with individual
departments;
a. Objectives
b. Apportionment of expenses
c. Departmental trading and profit and loss iii. compute departmental profits or losses.
account
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Principles of Accounts
TOPICS/CONTENTS/NOTES
13. Branch Accounts
a. Objectives
OBJECTIVES
Candidates should be able to:
i. determine the reasons for branch accounts;
ii. calculate profits and losses from branches;
b. Branch accounts in the head office iii. determine the sources of differences and reconcile
books
them.
c. Head office account
d. Reconciliation of branch and head
office books
Candidates should be able to:
14. Joint Venture Accounts
a. Objectives
iv. identify the objectives of Joint Venture;
v. determine the profit or loss of the Joint Venture;
vi. determine the profit or loss of each venture.
b. Personal accounts of venturers
c. Memorandum Joint venture accounts
15.
Partnership Accounts
Candidates should be able to:
a. Formation of partnership
b. Profit and loss account
i.
ii.
determine the instruments of partnership formation;
categorize all accounts necessary for partnership;
c. Appropriation account
d. Partners current and capital accounts
iii. determine the effects of admission and retirement of a
partner;
e. Treatment of goodwill
iv. prepare revaluation account
f.
Admission/retirement of a partner
v.
identify the accounts required for dissolution and
conversion to a company;
g. Dissolution of partnership
h. Conversion of a partnership to a vi. determine the partners share of profits or losses
company
Candidates should be able to:
i. differentiate between types of companies;
16. Introduction to Company Accounts
a. Formation and classification of
companies
ii. identify the processes and procedures of recording the
issue of shares and debentures;
b. Issue of shares and debentures
c. Final accounts of companies
d. Interpretation of accounts using
ratios.
iii. compute elements of final accounts of companies;
iv. interpret the accounts for decision making using
ratios such as current, acid test and stock turnover.
e. Distinction between capital and
revenue reserves
Candidates should be able to:
17. Public Sector Accounting
i.
differentiate between public sector accounting
and private sector accounting;
a. Comparison of cash and accrual basis
of accounting
ii.
identify the sources of government revenue;
b. Sources of government revenue
c. Capital and recurrent expenditure
d. Consolidated revenue fund
e. Statement of assets and liabilities
iii. differentiate
between
capital
and
recurrent
expenditure;
iv.
v.
calculate consolidated revenue fund and determine
the values of assets and liabilities;
analyse the duties of the Accountant General, the
Auditor General, the Minister of Finance and the
Treasurer of local government;
f.
i.
Responsibilities and powers of:
The Accountant General
ii. The Auditor General
iii. The Minister of Finance
iv. The Treasurer of local government
g. Instruments of financial regulation
vi.
distinguish between the elements of control in
government accounting procedures e.g. virement,
warrant, votes, authority to incur expenditure, budget
and due process certificate.
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Principles of Accounts
TOPICS/CONTENTS/NOTES
OBJECTIVES
Candidates should be able to:
18. Information Technology in Accounting
i.
relate and differentiate between manual and
computerized accounting processing system;
identify the processes involved in data
processing;
a. Manual and computerized accounting
processing system
ii.
b. Processes involved in data processing
c. Computer hardware and software
d. Advantages and disadvantages of
manual and computerized accounting
processing system.
iii.
iv.
relate the different components of computer;
identify the advantages and disadvantages of
manual and computerized accounting
processing system
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Principles of Accounts
RECOMMENDED TEXTS
Abdullahi D. Z. (2014). Modern Financial Accounting, Husab Global Press Concept Ltd.
Adeifa O. Ajileye, J. O and Oluwasanna, R. O (2001). Get your Financial Accounting Right. Book One:
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Ajileye, J. O. and Adetifa O. (2001). Get your Financial Accounting Right, Book Two: Lagos:
De Hadey Printing Services.
Akinduko, A. O (2001). Basic Accounting: Akure: Spetins.
Awoyemi, E. O. (1989). A guide to Government Accounting and Internal Audit, Ibadan: Onibonoje Press
Dodge, R. (2002). Foundation of Business Accounting, (Second Edition), Bershire: Chapman and Hall.
Ekwere, A. B. (1997). Contemporary Accounting, Abuja: Aflon Finance (Control and Management) Act 1959
Ekwue K. C. (2010). Principles of Accounts, Book 1 & 2, Onitsha: Adson Publishing Company,
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Frankwood and Alan S. (2002). Frankwood’s Business Accounting, Prentice Hall International Edition.
Hassan M. M. (2001). Government Accounting, Lagos: Malthouse Press Limited.
Igben, R. O. (2004). Financial Accounting Made Simple (Vol. I) Lagos: Roi Publishers.
Longe, O. A. and Kazeem, R. A (2006). Essential Financial Accounting for Senior Secondary Schools:
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Millichamp, A. H. (1989). Foundation Accounting: An Introduction manual for Accounting Students,
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