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| Sunday, 12 December 2004 |
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| News Business Features Editorial
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Book review : Financial Accounting in Sri Lanka Author: Dr. Hema Wijewardena The non-availability of high quality local textbooks in financial accounting compels students and teachers in universities, technical colleges and other educational and professional institutions in Sri Lanka to use foreign texts in their accounting courses. This has caused considerable difficulty for both students and teachers because all accounting textbooks imported from foreign countries are based on their own currencies, accounting standards, company law and tax regulations which are significantly different from those of Sri Lanka. Therefore, financial accounting texts of foreign origin do not suit the local business, economic, and cultural background. To ease the above situation, Dr. Hema Wijewardena has written and published a high quality accounting text of Sri Lankan origin under the title of Financial Accounting in Sri Lanka. This book is primarily intended for students who study financial accounting at universities, technical colleges, and professional institutions in Sri Lanka. Because of its in-depth coverage of the subject matter at both foundation and intermediate levels students preparing for the GCE examination can also benefit from the book. The author of this book is a professionally qualified accountant and a very senior academic with extensive experience in teaching accounting at several universities and professional institutions in Sri Lanka, Canada and Australia. He says that his long experience in teaching accounting and producing accounting texts for several International publishers has helped him in developing this book as a purely Sri Lankan text that provides a very effective modern approach to the study of accounting. As the author rightly stated in the preface, accounting and approaches to the teaching of accounting have undergone dramatic changes throughout the world, particularly over the past few decades. In many countries, the accounting profession has been consciously seeking a more theoretical foundation to the discipline. Some traditional terms, definitions and practices have been changed to make them more logical and conceptually appropriate. Although accounting is a practical discipline, it is considered essential that those learning it be provided with the reasons for the techniques and procedures they are attempting to master. Accordingly, modern accounting education goes beyond a training in the mechanical aspects of the subject and expects students to understand the rationale or the theoretical justifications for different techniques and procedure. The author has taken the above developments into consideration in developing this book. Being consistent with the widely accepted structure of accounting texts in most developed countries, what is termed the 'balance sheet' approach to accounting instruction has been adopted in this text in presenting the double-entry system of accounting. This is built around the concept of the accounting equation and the effect of transactions on assets, equities and liabilities. This approach, while enabling the student to gain an overall picture of the pattern and basic functions of accounting at an early stage, provides a more logical and meaningful way to begin the study of accounting. Recognising the importance of harmonising Sri Lankan accounting practices with international developments, the text also discusses how some traditional practices need to be refined in accordance with their theoretical foundations. The book provides an in-depth coverage of the basic concepts, techniques, procedures and practical applications of financial accounting with clarify of exposition and academic rigour. It also provides an appropriate balance between the theory and practice of accounting. In doing so, the text focuses on the application of Sri Lanka's accounting standards, company law, and income tax regulations. The chapters in this book have been arranged in a logical progression so that they can be studied in sequence. All the topics usually covered in modern textbooks on financial accounting are discussed in these chapters. Each chapter begins with a set of learning objectives that can be achieved by studying the material covered in that chapter. In addition to providing illustrations of practical examples throughout the text, a review exercise with a complete solution is presented at the end of each chapter as a key revision aid to help students check their progress. The comprehensive set of questions and exercises included at the end of each chapter covers the subject matter fully and can be used by instructors as tutorial assignments for their students.Following the widely used modern approach to the teaching of accounting, the double-entry system is introduced and developed in the early chapters on the basis of transactions that occur in service businesses operating as sole proprietorships. Because accounting for small service businesses is less complex, it is easier for a beginner to understand the initial steps in the accounting process through this approach. Accounting concepts, techniques and procedures applicable to trading and manufacturing businesses are progressively presented in subsequent chapters. The final chapters deal with the more complex aspects of accounting for partnerships and companies.The above features clearly show that this book is the first most comprehensive and up-to-date accounting text published in Sri Lanka. The author deserves high commendation for this unique contribution to the country's accounting education. Reviewed by Dr. M. W. Wickramarachchi, Professor of Accounting, University of Sri Jayewardenepura. |
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