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1. Assignment Front Sheet
Qualification Unit number and title
Pearson BTEC Level 5,
HND Business (Accounting)
Unit 10: Financial Accounting and Reporting
Unit code: F/601/0864
Credit value: 15 credits
Student name Assessor name
Sajid Saeed Khan
Date issued Completion date Submitted on Validity
3rd
December 2013 3rd
January 2014 3rd
April 2014
Assignment title Preparation of financial statements, complying with relevant legal and
regulatory provisions
Assignment no 10- F/601/0864-13IND
Hand-in Policy
You must complete this assignment on time. If you experience difficulties, you must inform your tutor
accordingly.
Late Work Policy
Consideration will be given to students who have valid reasons for late submission (eg, illness).
Plagiarism
In cases of plagiarism, college regulations will be applied. You must declare that this assessment is your own
work by signing the following statement:
Learner declaration
I certify that the work submitted for this assignment is my own and research sources are fully
acknowledged.
Student signature: Date:

2. Assessment Criteria
Learning
Outcome
Learning
outcome
Assessme
nt Criteria
In this assessment you will have the
opportunity to present evidence that
shows you are able to:
Task
no.
Evidence
(Page no)
LO1
Understand the
regulatory
framework for
financial
reporting
1.1
Describe the different users of financial
statements and their needs
1
1.2
Explain the legal and regulatory influences on
financial statements 1
1.3 Assess the implications for users 1
1.4
Explain how different laws/regulations are dealt
with by accounting and reporting standards
1
LO2
Be able to
prepare
financial
statements
from complete
or incomplete
records
2.1
Prepare financial statements for a variety of
businesses from a trial balance, making
appropriate adjustments
2,4
2.2
Prepare financial statements from incomplete
records
2
2.3
Prepare a consolidated balance sheet and profit
and loss account for a simple group of
companies
3
LO3
Be able to
present
financial
information in
accepted
formats for
publication
3.1
Explain how the information needs of different
user groups vary
4
3.2
Prepare financial statements in a form suitable
for publication by a sole trader, partnership and
limited company
4
LO4
Be able to
interpret
financial
Statements
4.1
Calculate accounting ratios to assess the
performance and position of a business
5
4.2
Prepare a report incorporating and interpreting
accounting ratios, including suitable
comparisons
5

3. In addition to the above PASS criteria, this assignment gives you the opportunity to submit evidence in order to achieve the following MERIT
and DISTINCTION grades
Grade Descriptor Indicative characteristic/s Contextualisation
M1 Identify and apply strategies to find
appropriate solutions
Effective judgements have been made.
An effective approach to study and research
has been applied.
To achieve M1, an effective approach to study and
research has been applied (Task 1)
To achieve M1, an effective approach to study and
research has been applied. (Task 2)
To achieve M1, an effective approach to study and
research has been applied. (Task 3)
To achieve M1, effective judgements have been made
(Task 4)
To achieve M1, effective judgements have been made.
(Task 5)
M2 Select / design and apply appropriate
methods / techniques
A range of sources of information has been
used
a range of methods and techniques have been
applied
Complex information/data has been
synthesised and processed
To achieve M2 a range of sources of information has been
used. (Task 2)
To achieve M2, complex information/data has been
synthesised and processed (Task 3)
To achieve M2 a range of methods and techniques have
been applied (Task 4)
To achieve M2, relevant theories and techniques have
been applied (Task 5)
M3 Present and communicate appropriate
findings Coherent, logical development of
principles/concepts for the intended audience
To achieve M3, coherent, logical development of
principles/concepts for the intended audience. (Task 1)
D1 Use critical reflection to evaluate own
work and justify valid conclusions
Conclusions have been arrived at through
synthesis of ideas and have been justified
The validity of results has been evaluated using
defined criteria
To achieve D1, conclusions have been arrived at through
synthesis of ideas and have been justified. (Task 1)
To achieve D1 the validity of results has been evaluated
using defined criteria. (Task 2)
D2 Take responsibility for managing and
organising activities
Autonomy/independence has been
demonstrated
Activities have been managed
To achieve D2, autonomy/independence has been
demonstrated. (Task 1)
To achieve D2, autonomy/independence has been
demonstrated. (Task 2)

4. To Achieve D2 autonomy/independence has been
demonstrated. (Task 3)
To Achieve D2 autonomy/independence has been
demonstrated. (Task 4)
To achieve D2, autonomy/independence has been
demonstrated, activities have been managed (Task 5)
D3 Demonstrate convergent /lateral /
creative thinking

5. Assignment brief
Unit Name number and
title
Unit 10: Financial Accounting and Reporting
Unit code: F/601/0864
Credit value: 15 credits
Qualification Pearson BTEC Level 5, HND Business (Accounting)
Start date 3rd
December 2013
Deadline/hand-in 3rd
January 2014
Assessor Sajid Saeed Khan
Assignment title
Preparation of financial statements, complying with relevant legal and
regulatory provisions
Task 1 (LO1, 1.1, 1.2, 1.3, 1.4 and M1, M3, D1 and D2)
You are working as a Senior Accounts Manager in a joint stock company, ABC Limited. Your company is
conducting a seminar on the topic of “Understand the regulatory framework for financial reporting’’. You
have been asked to present the following on behalf of your company:
1. Prepare a presentation on the topic ‘‘Users of financial statements and their needs''.
2. Prepare and present a detailed report on the following:
a) Explain the legal and regulatory influences on financial statements and assess its implications
for different users?
b) Explain in detail how different laws/regulations are dealt with by accounting and reporting
standards?

6. Task 2 (LO2, 2.1, 2.2 and M1, M2, D1, D2)
Mr. Shujrah run a small business for many years, he has never kept adequate accounting records. He
requires final accounts for the year ended 31 August 2003 to obtain a bank loan for the expansion of
the business. As a result, the following information has been obtained after a careful research:
All takings have been banked after deducting; cash drawings of £8,000, labour of £1,200 and Purchase
of goods for resale for £1,800. (Takings have been the source of all amounts banked). Gross profit of
33(1/3) % on cost has been obtained on all goods sold. Despite the availability of minimum accounting
records, Mr. Shujrah confirmed that he has taken goods costing £600 out of the business during the
year for his own use.
Mr. Shujrah’s business assets and liabilities are as follows:
As at '1 September 2002 '31August 2003
£ £
Stock in trade 8,600 16,800
Debtors for sales 3,900 4,300
Creditors for purchases 7,400 8,900
Rent prepaid 300 420
Electricity accrued 210 160
Balance at bank 2,300 1,650
Cash in hand 360 330
Bank payments during the year ended 31 August 2003 have been summarized as follows:
£
Purchases 101,500
Rent 5,040
Electricity 1,390
Delivery costs (to
customers) 3,000
Casual labour 6,620
Required:
(a) Calculate total purchases for the year ended 31 August 2003.
(b) Prepare a trading and profit and loss account for the year ended 31 August 2003 and a balance
sheet as at that date.
Task 3 (LO2: 2.3 and M1, M2, D2)
The following figures for the year to 30 September 1997 have been extracted from the books
and records of two companies, A-One Ltd and its subsidiary, B-One Ltd, which form a group:
Profit and Loss Accounts for the year to 30 September 1997
A-One Ltd B-One Ltd
£(In £(In Millions)

7. Millions)
Turnover 1,700 450
Cost of sales ( 920) (75)
Gross profit 780 375
Administration expenses (300) (175)
Income from shares in group company 120 –___
Profit on ordinary activities before taxation 600 200
Tax on profit on ordinary activities ( 30) (20)
Profit on ordinary activities after taxation 570 180
Dividends: paid ( 90) (50)
proposed (270) (100)
Retained profit for the year 210 30
Retained profit brought forward 220 70
Retained profit carried forward 430 100
Balance Sheets at 30 September 1997
A-One Ltd B-One Ltd
£(In Millions) £(In Millions)
Fixed tangible assets 1,280 440
Investments: Shares in group company 400 –
Current assets
Stocks 300 250
Debtors (including, for A-One Ltd,
The dividend proposed by the subsidiary) 280 150
Cash at bank and in hand 40 10
620 410
Creditors (amounts falling due within one
year)
Trade creditors ( 80) (160)
Other creditors, taxation and social security ( 160) ( 70)
Proposed dividend ( 270) (100)
( 510) (330)
Net current assets 110 80
Total assets less current liabilities 1,790 520
Provisions for liabilities and charges
Taxation, including deferred taxation ( 460) ( 20)
1,330 500
Capital and reserves
Called-up share capital (ordinary shares of
£1 each) 900 400
Profit and loss account 430 100
1,330 500
Additional information:
(a) A-One Ltd acquired 80 per cent of the shares in B-One Ltd on 1 October 1994. B-One Ltd’s
Profit and loss account balance as at that date was £40,000.
(b) Goodwill arising on acquisition is to be written off against the group’s retained profits.
(c) A-One Ltd takes credit within its own books of account for any dividends receivable from
B-One Ltd.
Required:
Prepare A-One Ltd & its subsidiary B-One Ltd consolidated profit and loss account for the year to 30
September 1997 and a consolidated balance sheet as at that date.

8. Task 4 (LO2 2.1 and LO3, 3.1, 3.2and M1, M2, D2)
A). Explain the importance of financial information of the company for different stakeholders.
B). You are to draw up a trading and profit and loss account for the year ending 31 March 2012, and a
balance sheet as at that date from the following trial balance and details of:
Description Amount in £(000)
Bank 8,100
Debtors 321,219
Creditors 237,516
Stock at 31 March 2011 290,114
Buildings at cost 800,000
Equipment at cost 320,000
Profit and loss account as at 31 March 2011 136,204
General reserve 120,000
Foreign exchange reserve 20,000
Authorized and issued share capital 800,000
Purchases 810,613
Sales 1,606,086
Carriage inwards 2,390
Carriage outwards 13,410
Salaries 384,500
Business rates 14,800
Office expenses 9,100
Sundry expenses 2,360
Provisions for depreciation at 31 March 2011:
Buildings 80,000
Equipment 96,000
Directors’ remuneration 119,200
Notes at 31 March 2012:
1. Stock £317,426.
2. Business rates owing £1,700; Office expenses owing £245.
3. Dividend of 15 per cent proposed.
4. Transfers to reserves: General £70,000; Foreign exchange £30,000.
5. Depreciation on cost: Buildings 5 per cent; Equipment 15 per cent.

9. Task 5 (LO4, 4.1,4.2 and M1, M2, D2)
The following are the summarized Profit Statements and Balance Sheets for A2Z Motors Ltd, a
manufacturing company, and Fashion Do-Do Ltd, a retailer.
A2Z Motors Ltd Fashion Do-Do Ltd
2009 2010 2009 2010
£000 £000 £000 £000
Sales 500 610 425 460
Cost of sales (245) (355) (210) (230)
Operating costs (225) (230) (190) (200)
Loan interest paid (7) (10) (7) (3)
Net profit 23 15 18 27
Fixed Assets at Net Book
Value 150 225 220 175
Stock 50 60 27 20
Debtors 20 30 – –
Bank 10 (35) 13 57
Creditors (25) (20) (35) (50)
205 260 225 202
Share capital 50 50 50 50
Retained profit 95 110 100 127
Long term loans 60 100 75 25
205 260 225 202
Required
1. Use ratios to compare the management’s performance from 2009 to 2010 for each company. (Use
year ended figures to calculate ratios)
2. Prepare a report incorporating and interpreting accounting ratios, suitable comparisons, weaknesses
and limitations of ratio analysis.

10. Evidence
checklist
Summary of evidence required by student
Evidence
presented
Task 1
Presentation on the topic ‘‘Users of financial statements and their needs''
and report on legal and regulatory influences on financial statements
Task 2 Calculate total purchases and prepare a trading and profit and loss account
Task 3
Prepare A-One Ltd & its subsidiary B-One Ltd consolidated profit and loss
account
Task 4
Report on the importance of financial information of the company for
different stakeholders and draw up a trading and profit and loss account for
the year
Task 5
Comparison of the management’s performance and prepare a report
incorporating and interpreting accounting ratios, suitable comparisons,
weaknesses and limitations of ratio analysis.

11. Submission guidelines
You must:
 Complete all tasks
 Present your work in one business report-style document which should include a table of contents,
references list, foot or end notes if any and appendices if any.
 Complete, sign and submit the usual statement of authenticity.
 Submit your work in a single word processed document of 4000-5000 approx .words. This word limit is
only for guidance and is not applied on grading.
 Produce clear specific reasoning and arguments in support of your answers.
 Make appropriate reference to the relevant concepts, techniques and theories.
 Appropriately cite all information success (in the text and bibliography) as per references guidelines
given to you before.