Syllabus

Paper 1 - Interpretation of Financial Statements 

The Syllabus outlines the content of the paper and how that content is examined.

The ability to understand and interpret financial statements is an essential skill for professionals who are involved in such tasks as investment decisions, assessing the performance of an organisation, extending credit to businesses and assessing the performance of management.

AIM

To develop understanding and appreciation of the contents of financial statements, the meaning of terminology used in the statements, how to interpret the performance of an organisation using the contents of the financial statements and the various accounting concepts which underpin the preparation of the statements.

CONTENT

Regulation of Financial Statements

• standard setting procedure

• legal framework

Financial Information

users of financial information
the needs of the different users
making financial information useful

Financial Statements

Balance Sheet, Profit and Loss Account.
Cash Flow Statement, Value Added Statement.
Directors' Report, Chairman's Statement.

Analysis of Financial Statements

financial ratios: liquidity, profitability, stock market, solvency, efficiency, cash flow and risk. Calculation and interpretation.

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