1. Briefing on ACT3121 Contents: Main aspects in the syllabus
Partnership
Company Accounts
Past Exam questions
Theory section
Technical/Calculation section
Q & A Session

2. Partnership Key areas: Characteristics Advantages & Disadvantages
Partnership Agreement

3. Cont. Key areas: Accounting for Partnership
Partnership Capital Account
Fixed Capital Method vs Fluctuating Capital Method
Current Account
Appropriation Account
Accounting Treatments:
Drawings
Interest on drawings
Interest on capital
Interest on loan
Salaries to partners

4. Comprehensive Example
The net profit for the partnership between Azlan and Chong for the year ended 31 December 20X8 was RM28,500. The capital accounts and current accounts for the partnership on 1 January 20X8 were as follow:
Capital accounts:
Azlan RM40,000
Chong RM50,000
Current accounts:
Azlan RM2,160
Chong RM1,500
In the year 20X8, Azlan has withdraws RM2,000 on 31 Mac 20X8. Azlan has been paid RM10,000 for his salary.

5. Cont. The contents of the partnership agreement are as follow:
i. Interest on the initial capital is 5% per year
ii. Azlan would be paid RM12,000 per year for his salary
iii. 8% interest per year would be levied on withdrawals by the partners
iv. Azlan and Chong share a profit/loss in a ratio of 2:3
Prepare:
The allocation of profit-loss using Profit-Loss Separation Account or Profit-Loss Separation statement for the year ending 31 December 20X8.
Capital account and current account for each partner
A balance sheet (equity section) as at 31 December20X8

6. Cont. Key areas: Accounting for Partnership Changes in Partnership
Change in Profit Sharing Ratio
Admission of a new partner
Retirement/death of an existing partner

7. Cont. If this happened, 2 issues are considered: Revaluation of assets
Goodwill
Amount is given
Account not to be maintained

8. Comprehensive Example: Admission
Adil and Bistari are partners sharing profits and losses ratio of 3:2 respectively. Their Balance sheet on 30th June 2009 is:
Assets:
Land and buildings RM40,000
Machinery RM16,000
Inventories RM10,500
Debtors RM30,000
Liabilities and Equity:
Creditors RM15,000
Bank overdraft RM6,500
Capital:
Adil RM45,000
Bistari RM30,000

9. Cont.
On 1 July 2009 Adil and Bistari agreed to accept Cerdik as a new partner. Cerdik has to pay RM25,000 cash including RM5,000 as a premium on goodwill. He is to share 1/6 of the profits and losses. Adil and Bistari will share their profits as before.
The following assets were revalued upon admission of Cerdik as follows:
Land and buildings RM45,000
Inventories RM10,000
Machinery RM14,000
Provisions for doubtful debts is to be 1% on debtors.
Prepare:
Goodwill account (not to be maintained)
Revaluation account
Capital account and current account for each partner
A balance sheet (equity section) as at 1 July 2009

10. Company Accounts Key areas: Types of Companies
Advantages & Disadvantages
Forming a company
Memorandum of association (MA)
Articles of association (AA)
Procedures to issue shares

11. Cont. Key areas: Capital Equity Authorised/Nominal/Registered Capital
Unissued Capital
Uncalled Up Capital
Paid up Capital
Debentures vs Shares

12. Cont. Key areas: Capital Equity Authorised/Nominal/Registered Capital
Unissued Capital
Uncalled Up Capital
Paid up Capital
Debentures vs Shares

13. Cont. Key areas: Financial Reporting Framework Regulatory Framework
Companies Act 1965
Financial Reporting Act 1997 & Accounting Standards
Accountants Act 1967
Institutional Framework
MASB
Financial Reporting Foundation

14. Equity Financing Key areas: Classes of shares
Ordinary share capital vs Preference share capital
Types of preference shares

15. Cont. Key areas: Issuance of shares
Directors have a number of options when issuing shares:
Choose to issue ordinary shares, preference shares or both
Issue shares at their par value, at a premium or at a discount

16. Cont. Key areas: Issuance of shares Shares may be issued
Payable in full on application
Paying a deposit on application and the remainder on allotment
Part payment on application, part on allotment and the remainder in one or more installments (or calls)

17. Cont. Key areas: Issuance of shares Installment Application Allotment
Call(s)
Forfeiture
Oversubscription
Refund
Pro-rata

18. Past Exam Questions Theory Part: Normally account to 20%
Cover all topics
Different level of understanding

19. Cont. Examples: Partnership
Identify and explain two (2) advantages of a partnership.
(4 marks)
‘There is really no need for a partnership agreement since
all issues are covered in the Partnership Act 1961’. Do
you agree with this statement, explain?
(6 marks)

20. Cont. Examples: Company Accounting
Explain the significance of minimum shares subscription
threshold to company issuing equity shares to public.
(4 Marks)
Discuss the shareholding spread requirements for
Malaysia listed incorporated companies and foreign
companies in Malaysia.

21. Cont.
Answer Scheme: Company Accounting
Refer to Word File

22. Past Exam Questions Technical/Calculation Part:
As shown in previous slides
Refer to Word File

23. Q & A