Today we had our 9th and 10th session and for the first time, I started to feeling like the language used to teach wasn’t Spanish but English. We did a recount of things learnt in the previous class which I unfortunately could not attend due to conflicting work priorities. They included:
- Time period assumption – a Business should report their financial statements appropriate to a specific period. Someone mentioned that it could be called the fiscal year.
- Accrual basis accounting – companies record transactions that change the company’s financial statements in the period in which the event occurs.
- Reason for adjusting entries in accounting – this is connected to ‘time periods assumption’ and ‘accrual’. Adjusting entries ensure that the revenue recognition and expense recognition principles are followed and this is necessary because the trial balance (the first pulling together of the transaction data) may not contain up-to-date and complete data. Importantly, adjusting entries are required every time a company prepares financial statements.
- Types of Adjusting entries are
- Deferrals – Prepaid expenses and Unearned revenue.
- Accruals – Accrued revenue and accrued expenses.
We then were asked to draw the following tables: Journal voucher, T account, Worksheet and Structure of trial balance. I took a stab at it whilst different people were called upon to show the class what they had done and what accounts go where. The word ‘account’ that is never ending in this class and something I need to get accustomed to.
We then took a break and returned to be allocated into groups and luckily it was familiar class groups we already belong to. Each group was given a task to work on and off we went into our groups. My group was familiar territory so I unmuted and we started speaking about the task at hand. We handed the ‘mic’ over to the subject matter experts (SMEs) and people we called the gurus in the Corporate Financial Management (CFM) class. They took us through the process of understanding the questions and allocating each statement to an account and shared with us the template to use.
As we were speaking and asking questions, like magic, the group section ended and we found ourselves back in the main class area. We were then asked to share our learnings from the group session we had, group by group. As is the usual fashion, our group was called upon to share first because we are Group 1. Whilst I am getting to understand the course a lot more, I do not have the confidence to speak articulately about the subject so I took a back seat whilst the braver more knowledgeable ones took a stab at sharing their learning. Other groups were called upon and at each point, we had people sharing their learnings.
After the sharing of learnings, we were shown another question and worked on it together as a class. One thing I am taking home with me and should not forget about the course is: We have 5 accounts which are Asset, Liability, Owners Equity, Revenue and Expenses.
The class ended with the professor sharing a few more assignments we were to handle in our groups and submit by the middle of the next week. Obviously, there is no breathing space for the student during and after class.
Really happy I can articulate my learning from a CFM class. This is my biggest win yet.
