Apr 14, 2016

Finance English practice: Unit 3 — Accounting and Accountancy
23 cards
, 100 answers
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  • Complete the sentences below. Use the key words if necessary.
    • Accounting

      key words
      Accounting      ○      recording      ○      transactions      ○      accountancy      ○      Bookkeeping      ○      Financial accounting      ○      Management accounting


      involves and summarizing an organization’s or business deal, such as purchases and sales, and reporting them in the form of financial statements. In many countries, the accounting or profession has professional organizations which operate their own training and examination systems, and make technical and ethical rules: these relate to accept ways of doing things.

      is the day-to-day recording of transactions.

      included bookkeeping, and preparing financial statements for shareholders and creditors — people or organizations who have lent money to a company.

      involves the use of accounting data by managers, for making plans and decisions.

      Auditing

      key words
      Auditing      ○      accuracy      ○      internal audit      ○      external audit      ○      true and fair view


      means examining a company's systems of control and the or exactness of its records, looking for errors or possible fraud: where the company may have deliberately given false information.

      An is carried out by a company's own accountants or internal auditors.

      An is done by independent auditors: auditors who are not employees of the company.

      The external audit examines the truth and fairness of financial statements. It tries to prevent what is called 'creative accounting', which means recording transactions and values in a way that produces a false result — usually an artificially high profit.

      • There is always more than one way of presenting accounts. The accounts of British companies have to give a of their financial situation. This means that the financial statements must give a correct and reasonable picture of the company's current condition.

        Laws, rules and standards

        key words
        laws      ○      follow rules      ○      standards      ○      apply      ○      annual accounts


        In most continental European countries, and in Japan, there are relating to accounting, established by the government. In the US, companies whose stocks are traded on public stock exchanges have to set by the Securities and Exchange Commission (SEC), a government agency. In Britain, the rules, which are called , have been established by independent organizations such as the Accounting Standards Board (ASB), and by the accountancy profession itself. Companies are expected to or use these standards in their in order to give a true and fair view.

        Companies in most English-speaking countries are largely funded by shareholders, both individuals and financial institutions. In these countries, the financial statements are prepared for shareholders. However, in many continental European countries businesses are largely funded by banks, so accounting and financial statements are prepared for creditors and the tax authorities.

      • What type of work does each person do?
        • I record all the purchases and sales made by this department. —  . . . 
          bookkeeping
          • external auditing
          • management accounting
          • accounting
          • financial accounting
          • bookkeeping

        • This month, I’m examining the accounts of a large company. —  . . . 
          external auditing
          • financial accounting
          • accounting
          • external auditing
          • bookkeeping
          • management accounting

        • I analyze the sales figures from the different departments and make decisions about our future activities. —  . . . 
          management accounting
          • accounting
          • bookkeeping
          • financial accounting
          • management accounting
          • external auditing

        • I’m responsible for preparing our annual balance sheet. —  . . . 
          financial accounting
          • financial accounting
          • management accounting
          • external auditing
          • accounting
          • bookkeeping

        • When the accounts are complete, I check them before they are presented to the external auditors. —  . . . 
          accounting or internal auditing
          • management accounting
          • external auditing
          • bookkeeping
          • accounting or internal auditing
          • financial accounting

      • Choose the most suitable answer to complete the statement
        • Accounting rules are established by a government agency in  . . . 
          the USA
          .
          • Britain
          • most of continental Europe and Japan
          • Britain and the USA
          • much of continental Europe
          • the USA

        • Companies are mainly funded by shareholders or stockholders in  . . . 
          Britain and the USA
          .
          • the USA
          • much of continental Europe
          • Britain and the USA
          • Britain
          • most of continental Europe and Japan

        • Accounting rules are set by an independent organization in  . . . 
          Britain
          .
          • Britain and the USA
          • much of continental Europe
          • the USA
          • most of continental Europe and Japan
          • Britain

        • The major source of corporate finance is banks  . . . 
          much of continental Europe
          .
          • Britain
          • Britain and the USA
          • much of continental Europe
          • the USA
          • most of continental Europe and Japan

        • Accounting rules are set by the government  . . . 
          most of continental Europe and Japan
          .
          • the USA
          • Britain and the USA
          • most of continental Europe and Japan
          • Britain
          • much of continental Europe

      • Choose the correct word to complete the phrase related to accounting
        •  . . . 
          carry out
          an audit
          • carry out
          • follow
          • apply

        •  . . . 
          do
          an audit
          • do
          • make
          • establish

        •  . . . 
          establish
          rules
          • establish
          • use
          • apply

        •  . . . 
          follow
          rules
          • summarize
          • follow
          • record

        •  . . . 
          make
          rules
          • make
          • do
          • carry out

        •  . . . 
          set
          rules
          • apply
          • use
          • set

        •  . . . 
          apply
          standards
          • do
          • record
          • apply

        •  . . . 
          establish
          standards
          • establish
          • set
          • summarize

        •  . . . 
          use
          standards
          • carry out
          • use
          • record

        •  . . . 
          record
          transactions
          • set
          • record
          • establish

        •  . . . 
          summarize
          transactions
          • apply
          • summarize
          • follow

      tags: Business & Finance English • Professional English in Use Finance • Ian MacKenzie
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