Page 79 - Accountancy for Advanced Secondary Schools Teachers Guide Form Five

7. Disclosure requirements
(a) Financial statements: Teach how hire purchase transactions
should be disclosed in the financial statements, including the
presentation of the asset and liability on the balance sheet and
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interest expense in the income statement.

(b) Notes to accounts: Discuss the required disclosures in the
notes to the financial statements, such as the terms of the hire
purchase agreement, interest rates, and payment schedules.

8. Regulatory framework
(a) NBAA, GAAP and IFRS: Highlight the relevant accounting
standards under Generally Accepted Accounting Principles
(GAAP) and International Financial Reporting Standards
(IFRS) that pertain to hire purchase transactions. Then try
link with local regulations released by National Board of
Accountants and Auditors (NBAA).

(b) Key differences: Discuss key differences between GAAP
and IFRS in the treatment of hire purchase accounting.

9. Tax implications
Tax treatment: Explain the tax implications of hire purchase
transactions for both the hirer and the hire, including the
deductibility of interest expense and depreciation.

10. Practical applications and case studies

(a) Real-world examples: Use real-world examples and case
studies to illustrate how hire purchase accounting principles
are applied in practice.

(b) Problem-solving exercises: Provide exercises and scenarios
that involve typical hire purchase accounting issues to
reinforce learning.

Teacher’s Guide Form Five
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