UNIVERSITY OF NATIONAL AND WORLD ECONOMY
BANK ACCOUNTING:SEMESTER: (WINTER)
TEACHER’S NAME: Assoc. Prof.PhD. Liliya Rangelova
OFFICE: University of National and World Economy – Sofia, Accounting and Analysis Department
Address: Studentski grad, Sofia 1700, Bulgaria
E-MAIL:
1. Annotation
The course in Bank Accounting is part of the study plan of Bachelor in Finance and Accounting. The main purpose of the course is to introduce students to the major issues relating to the nature of the Bank Accounting, its scientific theory and practical application. The course is to fulfill two main goals – to provide an in-depth knowledge about the bank accounting theory in an easily accessible way, and to facilitate the acquisition of additional practical skills of the accountants. This course fulfills the goal for interdisciplinary educational degree as the knowledge and skills of the students accumulated from other economic and especially accounting courses are to be extended and further specified. This will facilitate students with the opportunity to specialize in the complex area of banking. Students will distinguish the bank accounting as part of their economic science, including methods of research, specific terminology and gain of further economic knowledge. In order to respond to the contemporary requirements for a wide-range and in-depth provision of accounting knowledge to students, the interpretation of the course topics includes traditional approaches, as well as contemporary tendencies in the area of Financial Accounting.
At the end of the course the students should be able:
- to be well oriented in the various specific conditions through correct interpretation of the accounting information;
- to interpret and apply economic knowledge by discussing and solving of particular financial and economic problems;
- to make accounting related associations and inter-relations with the other courses of Basic Accounting Theory, Financial Accounting, Financial Control, Finance, Law, etc;
- to use of accounting data and indicators, methods and procedures;
- to explain the necessity of accounting information system in the banks;
- to explain the difference between the financial accounting and its specific application in banking;
- to systemize the information needed for the preparation of the financial statements of the banks;
- to analyze and interpret the accounting dynamics of the banks’ capital, its changes as a result of the performed economic operations, the changes in revenues and expenses of the banks and the accumulated profit;
- to analyze and interpret from an accounting perspective the bank money transfer payments;
- to analyze and interpret the bank loans from accounting perspective;
- to analyze and interpret from an accounting perspective the solvency indicators, capital adequacy, profitability and other factors, which determine the financial and economic stability of the banks.
2. LANGUAGE OF TEACHING
ENGLISH
3. COURSE CONTENT (TOPICS)
Topic 1. Characteristics of bank operations and bank accounting
1.1. General characteristics of bank activities as a subject of accounting
1.1.1. Bank activities
1.1.2. Bank transactions
1.2. General characteristics of bank accounting
1.2.1. Significance of the accounting for conducting and management of bank activities
1.2.2. Bank accounting
Topic 2. Accounting for bank liabilities
2.1. Accounting for share capital of commercial banks
2.1.1. Brief description of the subject of accounting
2.1.2. Accounting for share capital
2.1.3. Accounting for capital reserves
2.1.4. Accounting for profits and losses
2.2. Accounting for debt capital of commercial banks
2.2.1. Definitions and classification
2.2.2. Accounting for received term deposits
2.2.3. Accounting for current accounts and other received funds
2.2.4. Accounting for received loans and other debts
Topic 3. Accounting for cash-emission activities
3.1. Characteristic and accounting for emission operations
3.3.1. Accounting for operations of the Bulgarian National Bank
3.3.2. Accounting for cash transfers within the branches of the Bulgarian National Bank and the commercial banks
3.2. Accounting for cash operations
Topic 4. Accounting for financial assets
4.1. Classification of financial assets
4.2. Recognition and accounting for financial assets
4.3. Accounting for interests, discounts and premiums of financial assets
4.4. Revaluation of financial assets
4.5. Disposal of financial assets
Topic 5. Accounting for bank loans
5.1. Main characteristics and classification of bank loans
5.2. Accounting for bank loans
5.2.1. Accounting for contracted, but unutilized loans
5.2.2. Accounting for granted loans
5.2.3. Accounting for loan collaterals
5.2.4. Accounting for loan repayments
5.2.5. Accounting for non-performing loans
Topic 6. Accounting for domestic non-cash transfers
6.1. Main characteristics of inter-bank money transfers
6.2. Accounting for inter-bank money transfers
6.3. Accounting for direct transfer payments
6.4. Accounting for payments through direct debit
6.5. Accounting for payments through letters of credits
6.6. Accounting for payments through cheques
Topic 7. Accounting for foreign money transfers
7.1. Specifics of accounting for foreign money transfers
7.2. Accounting for payments through bank transfer
7.3. Accounting for payments through direct debit
7.4. Accounting for payments through letter of credit with prepayment
7.5. Accounting for payments through letter of credit with subsequent money transfer
7.6. Description and accounting for letter of credit by the commercial banks
7.7. Accounting for foreign payments through cheques
Тopic 8. Accounting for bank expenses
8.1. Nature and characteristic of bank expenses
8.2. Accounting for financial expenses
8.2.1. Interest expense
8.2.2. Expenses for specific provisions
8.2.3. Expenses incurred from operations and revaluation of assets at fair value through profit or loss, available-for-sale, held-to-maturity
8.2.4. Expenses incurred from foreign exchange transactions and revaluation
8.2.5. Other financial expenses
8.3. Accounting for expenses and classifications
8.3.1. Expenses for materials
8.3.2. Expenses for third party services
8.3.3. Depreciation expenses
8.3.4. Expenses for salaries
8.3.5. Expenses for health, pension and other social payments
8.3.6. Other expenses
8.4. Accounting for deferred expense
Тopic 9. Accounting for bank revenues
9.1. Nature and characteristics of bank revenues
9.2. Accounting for financial income
9.2.1. Interest income
9.2.2. Income from participations
9.2.3. Income from operations and revaluation of assets at fair value through profit or loss, available-for-sale, held-to-maturity
9.2.4. Income from foreign exchange transactions and revaluation
9.2.5. Income from reversed provisions
9.2.6. Other financial incomes
9.3. Accounting for sales income
9.4. Accounting for deferred income
Тopic 10. Accounting for bank profit
10.1. Nature and characteristic of bank profit
10.2. Accounting for bank profit
10.3. Accounting for corporate tax and profit distribution
Тopic 11. Financial reporting and preparation of bank financial statements
11.1. Legal regulation and content of financial statements.
11.2. Organization and stages of preparation of annual financial reports.
11.3. Statement of comprehensive income
11.4. Statement of financial position
11.5. Statement of changes in equity
11.6. Statement of cash flows
11.7. Reporting in compliance with the Bulgarian National Bank regulations
4. METHODS OF TEACHING
The teaching is conducted by combining lectures and seminars:
- all topics included in the study program are discussed and presented to students in the form of lectures and seminars;
- self-study and preparation and presentation of a coursework dedicated to bank accounting problems.
The needed equipment is: whiteboard and marker, sponge, multimedia
5. LEARNING OUTCOMES
The course will provide students with the following fundamental:
- knowledge of:
1. the role and significance of the bank accounting in practice;
2. the major aspects of the organization and use of bank accounting;
3. stages of historical development of bank accounting;
4. contemporary development conditions of bank accounting;
5. knowledge of reporting.
- skills:
1. to prepare accounting information for the performed bank transactions and activities;
2. to report and analyze the capital base of the banks;
3. to be aware of the bank payments reports;
4. to classify and report for the bank loans;
5. to classify and report for the banks’ assets and liabilities;
6. to classify and report for the banks’ revenues and expenses;
7. to prepare financial statements of the banks;
8. to analyze the investment policy of the banks;
9. to perform financial analysis of the banks’ financial statement
The knowledge and gained skills in bank accounting are needed for the study of accounting from scientific and practical perspective as well as for the preparation of the students for becoming accountants in the contemporary economic conditions.
6. ASSESTMENT METHODS
· On-going valuation is planned
· The individual participations are to be assessed in class in the presence of the other students during the seminar classes.
· The Semester Exam consists of two marks of equal weight – the mark received in the writing exam consisting of two tests and the mark received in the solving of a case.
· The Final Mark formula is the following:
FM = 0,5 (ET+ P) + 0,5 IA,
Where
FM = Final Mark
ET = Exam Test Mark
P = Case Solving Mark
IA = Individual Participation Mark
· The Final Mark is given on a scale of six with a minimal pass mark of “Satisfactory /3/”. The correspondence of the marks on the scale of six system to the European Credit Transfer system is as follows:
Excellent /6/ / Very Good /5/ / Good /4/ / Satisfactory /3/ / Poor /2/
A / B / C / D / E / FX / F
Credits are transferred as per study program / No credits are transferred
.
7. REFERENCES (MANDATORY AND RECOMMENDED)
А. ESSENTIAL READING
1. Bank Accounting, S. Stoyanov; D. Feschiyan; L. Rangelova, publishing house “Stopanstvo”, 2012.
2. International Financial Reporting Standards
3. Case studies on bank accounting - Assoc. Prof. Dr. D.Feschiyan and other academics - 2002
B. ADDITIONAL READING
1. Law on the Bulgarian National Bank
2. Law on the Credit Institutions
3. Regulations of the Bulgarian National Bank
4. Law on Accounting
5. Law on Payment Services and Payment Systems