ASS Step 2 General Feedback (ACCT11081)

“The study guide is not only a key learning tool for this unit, but I also feel as if the study guide has literally become a part of my life.”

“The study of accounting is absolutely a transformative process. It’s not just about knowing all the tips and tricks to the trade (in this case, the study of accounting); it’s about engaging with the process to gather our own understanding and develop our own unique way of applying our own abilities and thinking to different situations. Studying at university has definitely been a challenging process, but it has allowed me to gradually transform at my own ability and pace throughout my studies. I used to think that memorisation was one of the most important factors to studying and getting good grades. I used to write word-for-word notes from powerpoints or lectures, thinking that if I got all the facts down I would be able to embed them into my brain to reiterate later. But it really isn’t that simple. And Martin is absolutely correct! Attempting to memorise information that you have not properly engaged with is no fun and doesn’t really get you any step further. We must learn to evolve from the process of memorisation and depict our own true meaning/understanding of the facts.”

Connection … it’s all about connection

Quite a few people are finding that after their experience of learning with us in ACCT11059 Accounting, Learning & Online Communication, some things are a bit easier this time around; including making the mental effort to understand for ourselves the key concepts we are studying … and to feel a connection with the ideas we are studying and to experience change, real learning that transforms us in some ways:

“I have always been a hard worker; determined and committed to pushing myself to the best of my ability. I find it to be a great sense of achievement when you are able to understand and engage with material you have learnt and involved yourself with. I think a lot of it has to do with connection; how and if we choose to engage with our university studies. And what can I say? I’m ready for a change; a shift; a transformation. I want to explore the world of accounting and learn to grasp my own views and understandings of the material we will be studying this term. I feel like this transformative process will allow us to achieve valuable learning and connection. I am hesitant to fall short of my own personal transformation, but there is no turning back. I have nothing to lose, only something to gain!”

And it is a choice we make; no-one can make that choice for us. Just us, ourselves.

Three Things to Memorise

A few people (OK, everyone) have noticed that we have been pushing the ‘Three Things to Memorise’:

“Three things to remember. One minute a day. Challenge accepted Martin! I am happy to embrace this style of learning.

  1. Increase in an Asset is a debit.

      2. Assets + Expenses = Equity + Revenue + Liabilities

      3. Increases on the left-hand side are Debits; and increases on the right-hand side are Credits”

And some people felt a bit confused that after emphasising understanding material for ourselves in ACCT11059 Accounting, Learning & Online Communication, and not simply memorising material we do not understand, that we are now also emphasising the need to actively memorise material, such as the ‘Three Things to Memorise’:

“I have to say I was very confused at the start of this section because last term (in ACCT11059) I was introduced to a new way of learning which didn’t involve rote-learning or memorising facts.  Rote-learning only allows me to retain the information memorised for a short period because I didn’t completely understand this information and couldn’t relate it to my personal experiences …  Martin showed me a different way to retain information that didn’t include just memorising facts.  He showed me that understanding, engaging and relating this understanding to my personal experiences will allow me to recall this information throughout my life, not just for exams or assignments.  So, I was very surprised to learn that now he is pushing that indeed we need to also memorise facts…

…it has become clearer that in some instances I will need to memorise some key facts.  In order for me to retain this information for life and not just for a short period as that would be a waste of my time.   I need to follow a few simple rules; a bit like my son when he is learning his spelling words, I need to read the facts, write down the facts and check the facts.  Studies show that if I do this at least 40 times and then apply it to my personal experiences, I will never forget it.  My personal experiences lead me to believe that this approach works.  For instance, when I am learning a new process or procedure at work I am writing that process and updating the process and continually referring to the process.  After a very short time I don’t need to refer to the hard copy of the process as it is imbedded in my memory for life.  Its reminds me of when my sons were learning their ABC’s, what helped them to memorise the ABC’s was the ABC’s song; the beat helped them to recall what letters and the order they belong in.”

And many people have got the idea of doing both … understand the concepts and memorise them. We need to do both. Indeed, undestanding and memorising go hand-in-hand; like two friends:

“There’s no point saying, “I know I understood this but I can’t quite remember what it actually was”, but there’s also no point in saying “I remember this but don’t understand it”. We definitely do need both together. Understanding first is probably key, because if we initially memorise we probably won’t even get to the understanding part. So, my new rule here and something I’ll tell myself in all university studies is ‘understand first, memorise second’.”


Ledgers 1People commented on the central concept of ledgers in accounting. Ledgers are the core of any accounting system; the central piece of a firm’s accounts:

“Ledgers … are … the financial backbone of a firm. Why? Because the ledger is where a firm’s individual accounts are re-arranged to sort out transactions [into] assets, liabilities, equity, revenue and expenses.”

We also saw the idea of subsidiary ledgers, which do not replace the general ledger accounts but are subsidiary to them, providing more detail (for example, for accounts receivable, the individual balances owed by individual customers):

“Within ledgers there can also be subsidiary ledgers, where a firm can record further detail than that of the control account. The Coffee Supreme example of using subsidiary ledgers to record individual accounts for customers on accounts receivable was a great way to sum up the importance of recording individual accounts in order to correctly track customers’ balances.”

Internal control

And quite a few people communicated their understanding that the use of subsidiary ledgers along with a control account in the general ledger can help with internal controls in a business:

“Another key concept that stood out to me was that ‘the accounting process can be set up to help limit the opportunities for fraud (or breach of trust) by a firm’s employee’s’. Initially, I was confused as to how a company’s accounting process can help stop dishonest behaviour.

However, I now understand that the way a firm handles and manages their accounts can significantly reduce the occurrence of fraud. For example, by having one individual responsible for the accounts receivable control account in the general ledger and a different person responsible for the subsidiary ledgers, so as to reduce the likelihood of an employee purposely entering in records incorrectly. Therefore, I now also understand that one of the purposes of subsidiary ledger accounts is to aid the company’s internal controls, which I was not previously aware of. Furthermore, at my workplace, I can see this idea of the separation of duties as a different combination of two managers does the banking every week, resulting in a different person recording the banking each week and a different person taking the money to be deposited into the bank. This I presume is to limit the chance of money being stolen, especially since it is not just the one person doing it by themselves every week.”

GST (Goods and Services Tax)

GST 1We also looked at GST (Goods and Services Tax). We do this early in our accounting degree, because GST affects so many accounting entries and accounts. We saw the revenue and expense accounts are usually GST-exclusive; and that GST is handled in separate GST accounts:

…the GST rate in Australia is 10%, or 1/11th of the grossed-up amount. Working in a tax and accounting firm, I know a lot about GST. What includes GST? What doesn’t include GST? However, I am interested to learn about the importance GST has on a firm’s accounts as I am yet to properly explore this. Working with firms’ financials, I have hands-on experience of working in ledgers where all revenue and expense accounts are GST exclusive, and the three separate GST accounts where GST is handled. GST collected is the GST amount a firm has collected from the revenues it has received from customers and thus, this becomes what the firm ‘owes’ to the government. GST paid is essentially the GST amount a firm has paid to its suppliers, and this is what the government ‘owes’ the firm. Then the 3rd and final GST account is GST payments/refunds. This account is where you code payments (in which a firm has paid GST to the government) or refunds (in which GST paid by a firm exceeds the GST collected). It is good to have a refresher of what these accounts entail and why.”

Also, if you have not done so already, check out the short video on How Firms Account for GST.

Specialised journals

We also looked at specialised journals. Quite a lot of transactions are entered into specialised journals, rather than the general journal:

“Specialised journals are used for the purpose of recording specific transactions. The most common specialised journals that I know are the sales journal, cash receipts journal, purchases journal and cash purchases journal … The idea of specialised journals is quite smart, and ultimately creates more efficiency in a firm’s transactions and accounts.”

General journal

And we saw that there will still be transactions entered into the general journal, which do not fit into any of the specialised journals. And that when we enter transactions into the general journal, we need to provide more information describing the transaction (narration) so people can tell what the transaction involves:

“Now back to the general journal… This is the place where all other odd or non-recurring transactions of a firm will go. It makes sense that these journal entries would require more detail than specialised entries because they are non-specific and it needs to be made clear what each transaction involves.”


Exemplar 1It is quite a privilege for me to read your Step 2. I like to read them all; and I am sorry I have been a bit slow getting your mark and feedback to you. There have been some truly amazing Steps 2 written by a number of people, who communicated a positive, developing understanding about some of the key concepts.

There will be some great Step 2 exemplars posted shortly.

Building on our understanding of ‘where accounts come from’:

Now that we have read chapters of the Study Guide on double-entry bookkeeping, we can move on to build on the foundation of our understanding of why and how double-entry accounting works. This foundation will help us make sense and understand ‘where the accounts come from’ and how we use the concepts of accounting to help us connect to what is really going on in our businesses:

“Chapter 2 is now complete! It was a lot of information to take in; some old, some new. I can now say I have a deeper understanding of a firm’s accounts, how to capture and measure a firm’s activities/transactions, how special journals and subsidiary ledgers are utilised in a firm’s journal and ledger, as well as the importance of cash and non-current assets. My appreciation for accounting is only growing stronger. While some concepts may be challenging to get my head around, I am ready to take a step forward now to analyse and explore my newly assigned company Sky New Zealand!”



27 March 2018