“So how do I feel about to embark on yet another accounting subject? Let me just say the pre-requisite unit for this accounting unit (ACCT11059 Accounting, Learning and Online Communication) seems so far back. I watched Martin’s first lecture video and was very shocked that I have not remembered some things learnt in the previous unit. He asked the question, what is proprietorship? For the life of me, I could not remember at all what this was! I realised I needed to do a bit of revision…”

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“As I started to read Chapter 1 it took me straight back to this time last year when I was taking another of Martin’s units ACCT11059 Accounting, Learning and Online Communication. I could hear Martin speaking to me as I read down the page, oh how great it is to be back in one of Martin’s units.

As Martin reads aloud to me (in my own head) I hear him reconfirming probably the most important thing I learnt from ACCT11059 (actually let’s not limit it to that one unit, I could probably go as far as to say it was one of the most important things I have ever learnt), and that is that of truly learning, not to pass a unit or an exam, but to learn for true understanding and meaning, and to change as a person.”

Hi

I am enjoying reading your ASS Step 1.

Some people have come to really enjoy reading about accounting and including their key concepts and questions (KCQs) from ACCT11059 Accounting, Learning & Online Communication, and were missing writing their KCQs. Others were not so wildly missing them; but were becoming convinced of the benefit of reading and writing each week while studying accounting as it helps us understand (and retain) the key concepts we are studying and exploring together:

“I really wish I could say I missed writing my key concepts and questions [from ACCT11059] but … as much as I complain about having to write them however, I do believe having to write my KCQ’s as part of my assessment really promotes me to delve into the finer detail of the information stored in the Study Guide which leads to me being able to retain the information a lot more efficiently.”

Revision

The first three sections in Chapter 1 of the Study Guide are revising some of the key concepts studied in ACCT11059, as well as developing and deepening some of these concepts (such as the definitions of the five elements of accounting):

“Having completed ACCT11059 previously, I was very excited to see that the beginning to this term’s work was molded around where we left off, at least that’s how I felt. As I began to read the chapter ‘To understand reality’ I could clearly see how the topics covered from our last unit ACCT11059 will become of great use and understanding throughout the progression of this term, and how important it is for us to actually understand what it is we are reading. I am really excited to start this unit and learn and understand more about my future as an accountant.”

Some people appreciated this transition to our unit from ACCT11059 in a previous term:

“This first chapter has really made it feel like a very smooth transition from last term and slowly easing us into the work.”

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“My initial thoughts when I got started into chapter one was here we go again, then I was thinking can I simply go back and copy what I’d submitted last term? If only learning was this simple, once I hit section 1.3 we moved from revision to expansion and I crossed a few more repetitions towards my 40.”

Some people found they had a pretty good grip on the concepts we had been studying last term. Others, particularly those who studied their first term accounting unit a year or two ago, found the opportunity of revising some of these concepts helpful, for example accrual accounting:

“I’d completely forgotten the concept of accrual accounting. Of course, it seems ludicrous to complete the value of a firm only upon its demise. The simple concept of accounting for actions that arises as they occur rather than when cash is exchanged, especially with all the different forms of payments available. So we make some judgements and assumptions…”

Learning for meaning and understanding

Others commented on how they appreciated the opportunity to understand (and not only memorise) the material about bookkeeping:

“I felt a strong connection to the next segment of the Study Guide where Martin outlined the two different methods we can come to think about bookkeeping. The anatomy example provided a great explanation and I found myself nodding profusely. The first method outlined is the memorising of key facts, whereas the second looks to move beyond discrete information into gaining an understanding of how such key items are interrelated and connected to gain a true comprehension as a whole. Previously I have undertaken a bookkeeping course which was filled with information on where to allocate figures into accounts and how to do this in certain accounting software, this being the key facts, however it lacked further information on why this is done and the relationship between the various accounts. So while I was proficient in following instructions outlined in the course, I went away feeling deflated by my lack of knowledge and overall comprehension of the connection and relationship between accounts and figures and thus had difficulty in transferring my knowledge to ‘real life’. Therefore I’m excited to gain further meaning of bookkeeping in its entirety and the relationship between all the various segments and accounts.”

Some people thought the sections revising some of the key concepts from ACCT11059 were simply the same as in the previous unit; however, they then realised that these concepts were being developed and strengthened as well:

Once I had completed the introductory stage of the Study Guide and immersed myself into the ‘grit’ of the information, I presumed Martin had done a quick ‘copy and paste’ for the revision of material regarding double-entry accounting/bookkeeping as the wording seemed so familiar to the information I had previously read in the Study Guide for ACCT11059. But on further reading, I realised that while much of the information (and wording) was indeed identical, Martin was also giving us some added insight, gently opening the door into double-entry accounting/bookkeeping a little wider. Not too wide to scare us off, but just enough to remind us of the basics previously learnt and create more food for thought. My initial reaction when I recognised much of the information was indeed the same was to copy and paste my chapter reflection for chapter 1 ACCT 11059 (I’m a time poor student, please don’t judge!). But then I considered that those thoughts and feelings were my initial view into the accounting world and now that I have a little more understanding after completing said unit, how have my thoughts and feelings changed?

Consequently, I went back and read that first chapter reflection I wrote. It is evident that while my writing skills were on point, my thoughts were of a novice level, scratching the surface of the information provided but lacking more thoughtful consideration. For instance, in the chapter 1 reflection I outlined my enjoyment of reading the material regarding bookkeeping and the reasoning for there being two sides to everything, but what are my thoughts regarding these two separate sides of the coin? Now that I am more comfortable with the knowledge I possess I find myself considering the information more thoroughly. Firstly, double-entry accounting is a consequence of methods used in the past and has an emphasis on there being two sides to everything such as debits and credits and most importantly, the distinction between equity owners and the firm itself. But what do I understand the importance of this to be? Are we simply still using such a method as it’s the way it has always been done?”

And people are increasingly aware of the need to understand the material we study, and not just memorise it:

“From the first page in this chapter I can see that you have really focused on the way we learn as you want us to learn by not just memorising it.”

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“I need to cement the extended fundamental accounting equation into my brain, I think I ignored the importance of understanding this in the first two accounting subjects that I took, it has made me realise that I need to apply myself far more than what I have been in the past in order to not only know about the topic, but understand it.”

Five Ways of Studying Bookkeeping

A few people commented on the five ways we could study bookkeeping in the coming weeks. Some people positively resolved to seek to make the linkages between the concepts we study (to assist in applying the concepts in the real-world) and quite a few people suggested the 1st option of just ‘winging it’ may not be the way to tackle our unit:

“Although option 1 of the learning styles might have been something I would do in my high school years, I just don’t think that will cut it for university.”

Reading

There was a part in the Study Guide encouraging us to read regularly during the term. Some people commented about their experience of reading. Quite a few people are finding they do not read very much:

“Martin questions ‘How much do you read, in this media-rich world we live in?’  My answer is sadly that I do not read enough.  I find myself having difficulty to fall asleep at night because I believe I have too much screen (online) time.  I work eight hours a day at a desk in front of a computer, turn the TV on when I get home, browse on my iPhone or iPad during my lunch break, and of course during term, uni work at nights.  Instead of all this screen time, I could be reading a novel and learning new words/vocabulary rather than listening to drama or reality TV shows (Home and Away or House Rules are my favourites).  I guess this is what I get for growing up in a ‘digital decade’.”

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“Too be honest, I hate reading. The only reading I do is what we are assigned for in class as we of course are graded on the content we learn. However, I totally agreed with number 3 of why we should read this study guide. I do not have a great vocabulary and I haven’t for as long as I can remember, this is due to the lack and dislike of reading throughout my life. I believe if I continued to read throughout primary school and into secondary school and made the effort to find books that interest me I would have a better vocabulary than I do now.”

Others said they were voracious readers, and also commented light-heartedly that this might be why they were more interesting people:

“Considering I am somewhat addicted to reading I wholeheartedly agree with the importance of reading in our lives. Reading provides us with an abundance of benefits from enlarging our knowledge, to stimulating our brain and thus increasing brain power, memory, concentration, and even our analytical and critical thinking skills. So Martin, since you seem to be speaking my language I’m all ears!”

A number of people dread reading and are finding reading to be a significant adjustment to coming to university:

“It is mentioned that some of us may dread reading so much material for this assessment. To be honest, I felt that way last term because I personally dislike reading to a great extent, although now I am coming out of my denial that there is no getting out of reading while studying a degree. I no longer dread it, I now only look at the bright side, which is that reading expands your knowledge and there is no limit to the amount of information you can retain.”

Anatomy and bookkeeping

Some people commented on how they found the ‘anatomy-and-bookkeeping’ analogy useful to help them realise they need to not just learn individual, isolated facts but to also see the linkages and interrelationships between facts. This makes everything we learn a lot more useful in practice:

“I was particularly engaged in the comparison of bookkeeping and accounting to anatomy and medicine.  Through other accounting subjects I have studied I have learnt many individual facts but in order for them to be useful, I need to understand them as interrelated facts which make up the whole picture.”

Why we do double-entry bookkeeping?

One key concept mentioned by many people was the value of understanding the history of accounting and where double-entry bookkeeping came from; so we do not need to waste precious mental energy wondering why we are studying, and using, this complex system of accounting:

“I finished doing my taxes today, which meant going through all my records for the year and ensuring I had made all the correct entries in my accounting software for my side business. This process was certainly simpler than what it would have been prior to the computer age however Luca Pacioli still underpins everything that is happening.”

Proprietorship

People also connected well some of the key concepts to their prior knowledge and previous experience, which also helped to better communicate their understanding of the key concepts:

“One of the concepts of bookkeeping I initially struggled with when I first started running my business was proprietorship. In my first year, I only had one bank account which had my personal money, wages and the business money going in and out of it. Not only did this make a nightmare to do my taxes it also went against the concept of the business being separate to myself. Now the business has its own bank account and although it is still my money I view it as the business’s money and have a true reflection of the business.”

Five elements of accounting

We revised the five elements of accounting: Assets, Liabilities, Equity, Revenue and Expenses. These are the building blocks of accounting; the aspects of a business that we record in a firm’s accounts. We also further strengthened and developed the definitions of each of these elements. You will be able to use and rely on these definitions in later units in your degree. People found revising, and strengthening, our definitions of the five elements of accounting to be particularly helpful:

“One thing which I found particularly helpful was the explanations of the 5 Elements of Accounting in Chapter 1.3. Although I already have an understanding of the 5 elements, the explanations in this chapter were much more in-depth and provided a much more detailed background for how they affect the operations of a firm and how it adds value.”

Accrual accounting

People also commented on the key concept of accrual accounting; and many people gave a definition of what accrual accounting is in their own words:

“Accrual accounting requires the matching of expected costs and benefits of economic activities in a period, regardless of whether there has been any actual receipt or payment of cash. I think this was a great conclusion for me for the chapters, a good refresher and hopefully will retain most of what I have read.”

I look forward to working with you in the coming week as we further develop our understanding of some of the key concepts in bookkeeping. We will see the Three Things to Memorise (and start the process of making sure we memorise them). We will also look at ledgers and subsidiary ledgers; as well as journals and specialised journals. We will also look at GST, which potentially affects all the accounts of a firm in some way.