AL SHABAKA TECHNICAL INSTITUTIONAL ACADEMY

DUBAI

LEVEL 4 - CERTIFICATE IN BUSINESS

MANAGEMENT

NAME :    FLORAINE MHAY PULPULAAN   

REG No. :    a31120039

UNIT NAME :    BUS 1.3 - Financial Awareness

UNIT CODE :  D/507/1581

Context

This is a newly registered business organization and you are recruited as an

accounting manager for the specific organization. Accounting department
consists of 5 members including you as Team leader. The Senior Management
requires you to provide training to your subordinates. For that the management
has advised you to prepare a detailed report which covers the few expected
operations in your organization.

Task 1

Develop research noted including following areas:

→ Discuss the need for financial information, its purpose, limitations and the
main stakeholders interested in the information
→ Identify accounting arrangements and conventions used by organizations
 TASK 1

Assignment Solution

● Contents
- Introduction
- The Purpose of presenting financial information and stakeholder's interest to it
- Accounting arrangements and conventions used by organizations
- The Importance of financial information to stakeholders]

Introduction

Financial information is important to an entity to a group of potential stakeholders so that they

can make the best decision possible. Users are only given accurate financial information about an
entity if it is presented in a true and fair manner and in accordance with the relevant accounting
framework. The accounting conventions cover concepts such as relevance, reliability,
materiality, and comparability, all of which can be used to regulate the financial reporting
process in order to provide stockholders with the right financial information.

The Purpose of presenting financial information and stakeholder's

interest to it

Financial aspects of an organization's performance and management may pique the interest of
stakeholders. They will be particularly interested in how an organization's performance will
affect them. A stakeholder might be interested in investing in the company in exchange for a
proportional share of its equity and profits. As a potential investor, the stakeholder will require
financial statements in order to assess the organization's strength and make an investment
decision. Financial statements are used by an existing investor to monitor and evaluate their
investments.

Accounting arrangements and conventions used by organizations

Accounting conventions are guidelines that companies use to figure out how to record certain
types of business transactions that aren't covered entirely by accounting standards. These
procedures and principles are not legally binding, but accounting bodies generally accept them.
They are primarily intended to promote consistency and assist accountants in may arise when
preparing financial information.

It is valuable for investors to know how their investments are progressing in the company, and
through accountants they can prepare a proper financial report for stakeholders, but they can
organize it more effectively through accounting convention.
Multiple companies have to record transactions in the same way because accounting conventions
ensure that the activity is recorded consistently. Providing standardized methodology allows
investors to compare the financial results of different companies, such as competitors in the same
sector

The Importance of financial information to stakeholders.

The reason why stakeholders are interested in a financial report is because it provides a snapshot
of a company's financial health at a specific point in time, revealing information about its
performance, operations, cash flow, and overall state. Shareholders rely on them to make well-
informed decisions about their equity investments, particularly when voting on corporate
matters.
Task 2

For the second section of your file, you must choose an organisation you are
familiar with. You should be able to access the Financial Statements of your
chosen organisation to show applications and examples to demonstrate your
knowledge. Based on the information collected, prepare a report on the following
aspects:
→ Explain how accounting frameworks and regulation influence accounting
and financial arrangements.
→ Explain the uses of published financial information.
→ Provide Your interpretation of the financial information in these accounts
→ Identify trends in published accounting information for the chosen firm.
 TASK 2

Assignment Solution
Contents
- Introduction
- frameworks and regulation influence accounting and financial
arrangements.
- Uses of Financial Statements
- interpretation of the financial information in these accounts
- trends in published accounting information in Zurich.

Introduction

An accounting framework is a collection of guidelines for measuring, recognizing, presenting,

and disclosing data in financial statements. Auditors will not offer a clean audit opinion for an
organization's financial statements unless they were prepared using a recognized framework.

Frameworks and regulation influence accounting and financial

arrangements.
An accounting framework is a logical set of interconnected goals and fundamentals that should
lead to consistent standards that define the nature, purpose, and limitations of financial
accounting and financial statements. The key benefit of building a conceptual framework is that
it provides a framework for establishing accounting standards, a foundation for resolving
accounting disputes, and fundamental ideas that do not need to be repeated in accounting
standards.
Uses of published financial information

In many ways, financial statement publication gives investors the tools to understand an
organization's history. By revealing what goes on behind closed doors, the senior management
takes steps to enhance the visibility of the firm. by sharing what goes on behind corporate closed
doors. The method a corporation employs multiple elements to generate correct financial data
and issue accounting reports in a timely and consistent manner is referred to as organizational
memory. Products and services, mission statements, short- and long-term goals, rank-and-file
individuals, traditions, and values are all examples of organizational memory levers.

Interpretation of the financial information to Zurich account.

The Company has met its minimum capital requirements as prescribed by the Risk-Based Capital
Framework ("the RBC Framework") as of the date of the statement of financial position. MFRS
requires that certain criteria be used to prepare financial statements.

The use of certain important figures in the production of financial accounts in accordance with
MFRS is required.

Accounting estimates and assumptions that affect the reported amounts of assets and liabilities,
as well as the disclosure of contingent assets and liabilities, as well as the reported amounts of
revenues and expenses during the reporting period Statements

In addition, the Zurich Company Directors are also required to exercise their judgment in the
application of the Company's accounting policies. Although the Directors' estimates and
judgment are based on their best knowledge of current events, actual results may differ.
Trends in published accounting information in Zurich.

The Zurich's objectives are to obtain a reasonable assurance about whether the financial
statements of the company as a whole are free from material misstatement, whether due to fraud
or error and to issue an auditor's report that includes opinion

References:
Importance Of Financial Information to Stakeholders Accounting Example | Graduate Way
Regulation of Financial Accounting and Reporting: the... | Bartleby