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AAT – Financial Accounting: Preparing Financial Statements

How to prepare financial statements, such as profit or loss statements and balance sheets for sole traders and partnerships, starting from a trial balance.


This course teaches students how to prepare financial statements, such as profit or loss statements and balance sheets for sole traders and partnerships, starting from a trial balance. It equips them with both the theoretical knowledge and practical skills necessary for producing final accounts in a professional setting, whether manually or using accounting software.

Students will learn double-entry bookkeeping to accurately record transactions and make necessary adjustments like accruals to reflect the true financial status of the organization. They will understand depreciation methods for non-current assets and provisions for doubtful debts to enhance financial reporting accuracy.

The course also emphasizes the importance of final accounts’ format and usage. Students will refine their skills in error analysis and correction in ledgers and perform reconciliations to verify account balances with external documents like bank statements. Additionally, they will be introduced to accounting ratios to better assess and interpret the financial health of businesses.

Ethical practices, including integrity, objectivity, and professional competence, are integrated throughout the course to ensure students apply ethical principles in their accounting work.

Learning Outcomes:

On successful completion of this subject, you should be able to:
  1. Understand the accounting principles underlying final accounts preparation
  2. Understand the principles of advanced double-entry bookkeeping
  3. Implement procedures for the acquisition and disposal of non-current assets
  4. Prepare and record depreciation calculations
  5. Record period end adjustments
  6. Produce and extend the trial balance
  7. Produce financial statements for sole traders and partnerships
  8. Interpret financial statements using profitability ratios
  9. Prepare accounting records from incomplete information


Registration and Access

Once you complete an online purchase you will receive confirmation of account activation. Please allow 48 hours to get access to all the modules and for your eLearning account to be set up.

If you wish to receive an invoice instead of paying online, please contact us at info@lgca.uk. Access to the course is valid for 180 days.

Course Access Duration

Enjoy 6 months of unlimited access to all course materials, including videos, assignments, and resources. This period is designed to provide ample time for you to fully engage with and complete the course at your own pace.

Extension Options

Need more time? Extend your access with:

  • 3-Month Extension: £50 + VAT
  • 6-Month Extension: £90 + VAT

To arrange an extension, contact us at info@lgca.uk. Our support team is here to help.


Upon the successful completion of the subject Financial Accounting: Preparing Financial Statements, you can advance to the next subject of the AAT Diploma in Accounting Level or If you have already completed other subjects, you can proceed to the next level, the Diploma in Professional Accounting.

  • The primary users of final accounts
  • The framework of accounting underlying the preparation of final accounts
  • Qualities of useful financial information
  • Use of the accounting equation
  • Classification of ledger accounts
  • Purpose and use of books of prime entry and ledger accounting
  • Carry out financial period end routines
  • Importance of prior authority for capital expenditure
  • The importance of classifying expenditure into capital or revenue expenditure
  • Record acquisitions and disposals of non-current assets
  • Calculate depreciation
  • Record depreciation
  • Record accruals and prepayments of income and expenditure
  • Record irrecoverable debts and allowances for doubtful receivables
  • Record inventory
  • Considerations for recording period end adjustments
  • Prepare an initial trial balance
  • Prepare an adjusted trial balance
  • Complete the extended trial balance (ETB)
  • Prepare financial statements for sole traders
  • Opening and closing capital for sole traders
  • Produce the SPL for partnerships
  • Produce the SFP for partnerships
  • Calculate profitability ratios
  • The interpretation of profitability ratios
  • Identify missing figures
  • Mark-up and margin
  • Reasonableness of figures when information is incomplete
  • Study planner and guidance
  • Access to AccountingWise Learn
  • Comprehensive pre-recorded lectures
  • Extensive question practice (including mock exams and feedback)
  • Tutor support via phone or email

The AAT qualification is ideal for people who want a career in finance and business.

  • Format: Computer-based assessment
  • Availability: On Demand
  • Pass: A score of 70%
  • Length: 2 hours and 30 minutes
  • Please Note: Official Exam is not provided; it should be purchased separately.

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