My draft for assessment 1 (ACCT11059)

Step 1: 

Step 1 involves you writing down some of your ideas, reflections, and reactions to reading the Introduction and Chapter 1 in the Study Guide. 

Chapter 1: a way of viewing business 

The first thing I noticed was the jarring shift from familiar persons in writing; I’m used to most textbooks using third person language exclusively, leaving first and second behind entirely. It’s interesting to see second person used in the fourth word of the first paragraph. 

“Rather, each firm experiences its own economic and business realities quite independently of what gets recorded in its accounts.” I’m unsure how to interpret this section, as it implies that there are accounts or financial aspects of the business that doesn’t get recorded, which sounds to me like trying to cover up income to reduce what can be taxed. I really hope this gets clarified later on.  

“Not a fashion model, or a model plane, but a business model.” I can’t help but think this is quite wrong? It’s obviously not like a human who is modelling, but it is an image or description of the business it describes, no? “It is a model, or simplification, of each firm’s economic and business realities.” Yeah it is? I don’t understand why we need to invoke fashion models or toy planes then; we’re talking about the visualisation of a business’s reality. 

Chapter 1.1: It is all about reality 

“Some people think numbers merely reflect reality... but we believe that numbers create reality.” I do think numbers are reflections of reality, and struggle to see how a man-made concept can fabricate the reality in which we live. 

The first paragraph seems to be quite unnecessary to me. All I really got from it was “accounting is about understanding business for any reason” 

The second paragraph – I understand what it’s saying quite well; businesses are about creating adequate goods or services for a population to enjoy. 

The third paragraph I understand to be saying “businesses have power, similar to individuals, but scaled.” I hope I’m not misunderstanding what the core points of these paragraphs are, because I’m not having much of a reaction to them by the looks of this page. 

Paragraph 4: I’ve noticed a couple times now that the text invokes Australia and New Zealand. I imagine it’s because New Zealand is so similar and close to Australia, but I believe they are distinct countries, so I don’t see why including New Zealand would be overly necessary. 

“Richard Umbers, a retail executive without an accounting background.” To say many high names in businesses have accounting backgrounds, only to then list this as an example seems quite counterintuitive to me. I would imagine saying an accounting background isn’t necessary to scale business roles goes against what the overall message is (which I understand to be): having a background in accounting makes scaling business ranks significantly easier. 

“Maybe, or maybe not.” I understand that this is supposed to provoke the reader to do their own thinking, and to allow them to come to their own conclusion. Not providing a cemented answer and leaving it up to interpretation allows the reader to think heavily about their answer. I think that accounting does have important “things” for someone looking to be successful in business. 

“I was at a Christmas function at a friend’s house.” I’ve never read a textbook using first person. This feels like reading someone’s blog post on reddit or a story on Instagram (minus the annoying timers that people have on their stories).  

“not just look at accounting numbers (such as ‘profit’) as being some sort of ‘answer’ or reality themselves but instead to see we use accounting information to engage with what is really going on in a business.” I thought that was the point? That the reality of the business is the answer (to “what is going on in the business”), and thus the numbers were the answers. 

“We can subtly start to feel the numbers are the answer, rather than the business reality the numbers seek to represent.” I think that would there not be so many questions that rely on numerical answers, the numbers would be easier to differ from an answer, and more so a representation of reality. Not to say the numbers aren’t reality’s representation, but given (as far as I know) most of accounting’s questions ask what a number is, it makes sense to me that people would jump to “the number is the answer”. 

“Firms can be involved in providing services to customers, retailing products, or manufacturing products.” I see this to be similar to the business structure we were taught in business studies in high school; businesses can be tertiary, secondary or primary – providing intangible goods/services, selling finished products and selling raw products (materials: timber, iron etc.). 

Businesses are everywhere 

I’m noticing that every subtopic or new heading starts off with a quote from someone of relevance to me as a student of accounting: accountants, lecturers and students. I think this is going to be relevant later – somehow relating anecdotes to top-notch accounting. 

The following paragraph is also an anecdote, I can’t believe this is the first textbook I’ve read with so much personal language (I, me, you etc.). 

The anecdote lists a lot of businesses, and it reminds me a lot of a couple streets in my hometown where the entirety of the street is various businesses: hairdressers, dentists, supply shops (for school/office equipment), car shops, snack/convenience/corner stores and more (I just haven’t entered the rest of them). It’s interesting to notice how frequent that actually is. 

Paragraph 4: I don’t know if the questions are rhetorical, but I do know they invoke a fair amount of thought to actually arrive at an answer. I think the last question “What sense do you think you could possibly make of it?” Asks me to visualise what accounting information looks like, and whether or not it makes sense to me. 

Types of Businesses 

Having read the sentence on sole traders, I think I’m going to understand what this section means by “types of businesses”, as this is something I did to quite an extent in high school. 

“Now a trust can only conduct business through a trustee.” It actually feels like I’m reading someone’s blog or reddit post. The “now” feels like the writer of this section was writing how they would speak. 

Chapter 1.2: Keeping records 

“Unless they are first recorded and included in a firm’s accounting system, a firm’s accounts can give us no guidance or help in understanding its economic and business realities.” This seems completely opposite to what I understand of accounts. I thought they would be the answer to “how is this business doing” whether we understood them or not, and simply understanding was the difficult part. This section feels like it’s trying to say that without the proper action, the accounts are basically worthless. 

“the question we can reflect on is whether a firm’s accounts may help or perhaps hinder us in gaining these insights.” I outright fail to understand how a firm’s accounts would make things more complicated to understand. 

“Surely it would have been easier to simply enter in transactions once rather than twice as occurs in double-entry accounting.” I can see many reasons why a firm or individual would document twice for each one financial interaction, the main one being if an accident were to occur and one of the documents were destroyed or vandalised, there would be backup. 

“At first sight, this seems like a lot of double handling. At second and third look, it also seems like a lot of double handling.” my first time reading this, it seemed unnecessary to structure this way. Now (my second reading), it also seems unnecessary to structure this way. I don’t see why “it continues to seem like a lot of double handling” wouldn’t suffice. 

We build on the past 

Paragraph 2 seems extensive, but unnecessary to me. I think the main message is “It took me a while to learn how to shift from typewriter to touch-typing". 

“But we need to understand how these things work because our whole accounting system is built on these ideas.” While I did enjoy learning about why computer keyboards are the way that they are, I don’t agree that knowing about something’s origin is inherently necessary, much less when that origin was some 600 – 700 years ago. 

Bookkeeping without books 

Having read this chapter, the only thing I really understood was that we used to keep records of business accounts twice, with physical books, and now it’s done online, twice. 

Two sides to everything 

“There is a great difference between knowing and understanding: you can know a lot about something and not really understand it.” I intimately understand that difference; whether or not you can put it in your own words is quite the tell for if someone else can. 

Confidence and understanding 

Having watched both the videos on confidence, it does confirm a belief I was showed when I was young, that the best way to become confident is to fake it until you make it. 

Journals and Ledgers 

Paragraph 1&2: Again, I find it interesting that the majority of the paragraphs are stories that seem unrelated to the topic at hand; talking about the derivative of the word in various languages instead of simply saying it means a place you write transactions. I imagine by this point it’s not an accident, and serves to try making the point of the paragraph stronger through various examples, as opposed to having the point be majority of the paragraph, and the single example usually to support. 

Step 2/3:  

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