ACCA F1[1]

© ACCA 2013 All rights reserved. 1 Accountant in Business (FAB/F1) February 2013 to January 2014 This syllabus and study guide is designed to help with teaching and learning and is intended to provide detailed information on what could be assessed in any examination session. THE STRUCTURE OF THE SYLLABUS AND STUDY GUIDE Relational diagram with other papers This diagram shows direct and indirect links between this paper and other papers preceding or following it. Some papers are directly underpinned by other papers. These links are shown as solid line arrows. The links between papers where there is only an indirect link and no required underpinning are shown as dotted line arrows. The relational diagram therefore indicates where you are expected to have underpinning knowledge and where it would be useful to review previous learning before undertaking study. Overall aim of the syllabus This explains briefly the overall objective of the paper and indicates in the broadest sense the capabilities to be developed within the paper. Main capabilities This paper’s aim is broken down into several main capabilities which divide the syllabus and study guide into discrete sections. Relational diagram of main capabilities This diagram illustrates the flows and links between the main capabilities (sections) of the syllabus and should be used as an aid to planning teaching and learning in a structured way. Syllabus rationale This is a narrative explaining how the syllabus is structured and how the main capabilities are linked. The rationale also explains in further detail what the examination intends to assess and why. Detailed syllabus This shows the breakdown of the main capabilities (sections) of the syllabus into subject areas. This is the blueprint for the detailed study guide. Approach to examining the syllabus This section briefly explains the structure of the examination and how it is assessed. Study Guide This is the main document that students and learning and content providers should use as the basis of their studies, instruction and materials respectively. Examinations will be based on the detail of the study guide which comprehensively identifies what could be assessed in any examination session. The study guide is a precise reflection and breakdown of the syllabus. It is divided into sections based on the main capabilities identified in the syllabus. These sections are divided into subject areas which relate to the sub-capabilities included in the detailed syllabus. Subject areas are broken down into sub-headings which describe the detailed outcomes that could be assessed in examinations. These outcomes are described using verbs indicating what exams may require students to demonstrate, and the broad intellectual level at which these may need to be demonstrated (*see intellectual levels below). Learning Materials ACCA's Approved Learning Partner - content (ALP- c) is the programme through which ACCA approves learning materials from high quality content providers designed to support study towards ACCA’s qualifications. ACCA has one Platinum Approved Learning Partner- content which is BPP Learning Media. In addition, there are a number of Gold Approved Learning Partners - content. For information about ACCA's Approved Learning Partners - content, please go ACCA's Content Provider Directory. The Directory also lists materials by Subscribers, these materials have not been quality assured by © ACCA 2013 All rights reserved. 2 ACCA but may be helpful if used in conjunction with approved learning materials. You will also find details of Examiner suggested Additional Reading which may be a useful supplement to approved learning materials. ACCA's Content Provider Directory can be found here – HUhttp://www.accaglobal.com/learningproviders/alpc/c ontent_provider_directory/search/UH. Relevant articles will also be published in Student Accountant. LEVEL OF ASSESSMENTS – INTELLECTUAL DEMAND ACCA qualifications are designed to progressively broaden and deepen the knowledge and skills demonstrated by the student at a range of levels on their way through each qualification. Throughout, the study guides assess both knowledge and skills. Therefore a clear distinction is drawn, within each subject area, between assessing knowledge and skills and in assessing their application within an accounting or business context. The assessment of knowledge is denoted by a superscriptK and the assessment of skills is denoted by the superscriptS. VALUE OF ASSESSMENTS – GUIDED LEARNING HOURS AND EDUCATION RECOGNITION As a member of the International Federation of Accountants, ACCA seeks to enhance the education recognition of its qualification on both national and international education frameworks, and with educational authorities and partners globally. In doing so, ACCA aims to ensure that its qualifications are recognized and valued by governments, regulatory authorities and employers across all sectors. To this end, ACCA qualifications are currently recognized on the education frameworks in several countries. Please refer to your national education framework regulator for further information about recognition. GUIDE TO EXAM STRUCTURE The structure of examinations varies within and between modules and levels. The FIA examinations contain 100% compulsory questions to encourage candidates to study across the breadth of each syllabus. All FIA examinations are assessed by two-hour paper based and computer based examinations. The pass mark for all FIA examination papers is 50%. GUIDE TO EXAMINATION ASSESSMENT ACCA reserves the right to examine anything contained within any study guide at any examination session. This includes knowledge, techniques, principles, theories, and concepts as specified. For the financial accounting, audit and tax papers, except where indicated otherwise, ACCA will publish examinable documents once a year to indicate exactly what regulations and legislation could potentially be assessed within identified examination sessions. Examinations regulation issued or legislation passed on or before 30th September annually, will be assessed from June 1st of the following year to May 31st of the year after. Please refer to the examinable documents for the paper (where relevant) for further information. Regulation issued or legislation passed in accordance with the above dates may be examinable even if the effective date is in the future. The term issued or passed relates to when regulation or legislation has been formally approved. The term effective relates to when regulation or legislation must be applied to entity transactions and business practices. The study guide offers more detailed guidance on the depth and level at which the examinable documents will be examined. The study guide should therefore be read in conjunction with the examinable documents list. © ACCA 2013 All rights reserved. 3 Qualification structure The qualification structure requires candidates who wish to be awarded the Diploma in Accounting and Business to pass the F1/FAB, F2/FMA and the F3/FFA examinations and successfully complete the Foundations in Professionalism module. Syllabus structure 'The Foundations in Accountancy suite of qualifications is designed so that a student can progress through three discrete levels; Introductory Certificate level, Intermediate Certificate level and the Diploma level. Students are recommended to enter FIA at the level which is most appropriate to their needs and abilities and to take examinations in order, but this is not a requirement. P1 F1 FAB ACCA FIA P3 F1/FAB F3/FFA F2/FMA FiP* Diploma in Accounting and Business ++ + = * Foundations in Professionalism © ACCA 2013 All rights reserved. 4 Syllabus AIM To introduce knowledge and understanding of the business and its environment and the influence this has on how organisations are structured and on the role of the accounting and other key business functions in contributing to the efficient, effective and ethical management and development of an organisation and its people and systems. RATIONALE The syllabus for FAB/F1, Foundations of Accounting in Business introduces students who may not have a business background, to the business, which as an entity is made up of people and systems which interact with the environment and with each other. The syllabus begins with examining the purpose and types of business which exist, the key stakeholders and the rights and responsibilities that businesses have in connection with them, exploring the external influences that affect the business in its environment, including economic, legal, social and technological factors. The syllabus then examines the structure and functions of business, focusing on corporate governance and the specific accounting related roles in this process, particularly in financial reporting, assurance, control and compliance. The syllabus then introduces key leadership, management and people issues such as effective individual and team behaviour, motivation and personal effectiveness. The final section of the syllabus examines how behaviour at all levels within business should be underpinned by accepted professional ethics and professional values. MAIN CAPABILITIES On successful completion of this paper, candidates should be able to: A Understand the purpose and types of businesses and how they interact with key stakeholders and the external environment. B Understand business organisation structure, functions and the role of corporate governance C Recognise the function of accountancy and audit in communicating, reporting and assuring financial information and in effective financial control and compliance D Recognise the principles of authority and leadership and how teams and individuals are recruited, managed, motivated and developed. E Understand the importance of personal effectiveness as the basis for effective team and organisational behaviour. F Recognise that all aspects of business and finance should be conducted in a manner which complies with and is in the spirit of accepted professional ethics and professional values RELATIONAL DIAGRAM OF MAIN CAPABILITIES Leading and managing individuals and teams (D) The business organisation, its stakeholders and the external environment (A) Professional ethics in accounting and business (F) Business organisation structure, functions and governance (B) Personal effectiveness and communication (E) Accounting and reporting systems, controls and compliance (C) © ACCA 2013 All rights reserved. 5 DETAILED SYLLABUS A The business organisation, its stakeholders and the external environment 1. The purpose and types of business organisation 2. Stakeholders in business organisations 3. Political and legal factors affecting business 4. Macro economic factors 5. Micro economic factors 6. Social and demographic factors 7. Technological factors 8. Environmental factors 9. Competitive factors B Business organisational structure, functions and governance 1. The formal and informal business organisation 2. Business organisational structure and design 3. Organisational culture in business 4. Committees in business organisations 5. Governance and social responsibility in business C Accounting and reporting systems, controls and compliance 1. The relationship between accounting and other business functions 2. Accounting and finance functions within business organisations 3. Principles of law and regulation governing accounting and auditing 4. The sources and purpose of internal and external financial information, provided by business 5. Financial systems, procedures and related IT applications 6. Internal controls, authorisation, security of data and compliance within business 7. Fraud and fraudulent behaviour and their prevention in business, including money laundering. D Leading and managing individuals and teams 1. Leadership, management and supervision 2. Recruitment and selection of employees 3. Individual and group behaviour in business organisations 4. Team formation, development and management 5. Motivating individuals and groups 6. Learning and training at work 7. Review and appraisal of individual performance. E Personal effectiveness and communication 1. Personal effectiveness techniques 2. Consequences of ineffectiveness at work 3. Competence frameworks and personal development 4. Sources of conflicts and techniques for conflict resolution and referral 5. Communicating in business. F Professional ethics in accounting and business 1. Fundamental principles of ethical behaviour 2. The role of regulatory and professional bodies in promoting ethical and professional standards in the accountancy profession 3. Corporate codes of ethics 4. Ethical conflicts and dilemmas © ACCA 2013 All rights reserved. 6 APPROACH TO EXAMINING THE SYLLABUS The syllabus is assessed by a two hour paper-based or computer-based examination. Questions will assess all parts of the syllabus and will test knowledge and some comprehension or application of this knowledge. The examination will consist of 50 two mark questions. ACCA will introduce longer style questions in the future and as such approved learning content materials will contain some of these longer style questions. ACCA will provide sufficient notice on when the longer style questions will be introduced. © ACCA 2013 All rights reserved. 7 Study Guide A THE BUSINESS ORGANISATION, ITS STAKEHOLDERS AND THE EXTERNAL ENVIRONMENT 1. The purpose and types of business organisation a) Define ‘business organisations’ and explain why they are formed.[K] b) Describe common features of business organisations.[K] c) Outline how business organisations differ.[K] d) List the industrial and commercial sectors in which business organisations operate.[K] e) Identify the different types of business organisation:[K] i) Commercial ii) Not-for-profit iii) Public sector iv) Non-governmental organisations v) Cooperatives 2. Stakeholders in business organisations a) Define stakeholders and explain the agency relationship in business and how it may vary in different types of business organisation.[K] b) Define internal, connected and external stakeholders and explain their impact on the organisation.[K] c) Identify the main stakeholder groups and the objectives of each group.[K] d) Explain how the different stakeholder groups interact and how their objectives may conflict with one another.[K] e) Compare the power and influence of various stakeholder groups and how their needs should be accounted for, such as under the Mendelow framework.[K] 3. Political and legal factors affecting business a) Explain how the political system and government policy affect the organisation.[K] b) Describe the sources of legal authority, including supra-national bodies, national and regional governments.[K] c) Explain how the law protects the employee and the implications of employment legislation for the manager and the organisation.[K] d) Identify the principles of data protection and security.[K] e) Explain how the law promotes and protects health and safety in the workplace.[K] f) Recognise the responsibility of the individual and organisation for compliance with laws on data protection, security and health and safety.[K] g) Outline principles of consumer protection such as sale of goods and simple contract.[K] 4. Macro-economic factors a) Define macro-economic policy.[K] b) Explain the main determinants of the level of business activity in the economy and how variations in the level of business activity affect individuals, households and businesses.[K] c) Explain the impact of economic issues on the individual, the household and the business: [K] i) inflation ii) unemployment iii) stagnation iv) international payments disequilibrium. d) Describe the main types of economic policy that may be implemented by government and supra-national bodies to maximise economic welfare.[K] e) Recognise the impact of fiscal and monetary policy measures on the individual, the household and businesses.[K] © ACCA 2013 All rights reserved. 8 5. Micro economic factors a) Define the concept of demand and supply for goods and services.[K] b) Explain elasticity of demand and the impact of substitute and complementary goods.[K] c) Explain the economic behaviour of costs in the short and long term.[K] d) Define perfect, imperfect and monopolistic markets.[K] 6. Social and demographic factors a) Explain the medium and long-term effects of social and demographic trends on business outcomes and the economy.[K] b) Describe the impact of changes in social structure, values, attitudes and tastes on the organisation.[K] c) Identify and explain the measures that governments may take in response to the medium and long-term impact of demographic change.[K] 7. Technological factors a) Explain the effects of technological change on the organisation structure and strategy:[K] i) Downsizing ii) Delayering iii) Outsourcing b) Describe the impact of information technology and information systems development on business processes.[K] 8. Environmental factors a) List ways in which the businesses can affect or be affected by its physical environment.[K] b) Describe ways in which businesses can operate more efficiently and effectively to limit damage to the environment.[K] c) Identify the benefits of economic sustainability to a range of stakeholders.[K] 9. Competitive factors a) Identify a business’s strengths, weaknesses opportunities and threats (SWOT) in a market and the main sources of competitive advantage.[K] b) Describe the activities of an organisation that affect its competitiveness:[K] i) purchasing ii) production iii) marketing iv) service c) Explain the factors or forces that influence the level of competitiveness in an industry or sector using Porter’s five forces model.[K] B BUSINESS ORGANISATION STRUCTURE, FUNCTIONS AND GOVERNANCE 1. The formal and informal business organisation a) Explain the informal organisation and its relationship with the formal organisation.[K] b) Describe the impact of the informal organisation on the business.[K] 2. Business organisation structure and design a) Describe the different ways in which formal organisations may be structured: entrepreneurial, functional, matrix, divisional, departmental, by geographical area and by product.[K] b) Explain basic organisational structure concepts: [K] i) separation of direction and management ii) span of control and scalar chain iii) tall and flat organisations c) Explain the characteristics of the strategic, tactical and operational levels in the organisation in the context of the Anthony hierarchy.[K] d) Explain centralisation and decentralisation and list their advantages and disadv