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Fundamentals of accounting

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This module provides a broad introduction to accounting study at university level. It covers the fundamentals of financial and management accounting as well as the essential skills, knowledge and ethics required to be a professional accountant. The module will also be suitable if you are in a general management position, as the accounting material covers measuring management performance and improving financial planning, control and decision-making. You'll gain an understanding of financial reports through their preparation, based on the double-entry bookkeeping system, which is essential for the management of any organisation. 

What you will study

Proper accounting is crucial for the prosperity and survival of any organisation. Our complex economic system depends on accurate, trustworthy and relevant financial records and reports. While this module focuses on the accounting required for a sole trader, the skills and knowledge you'll learn are of central importance for accounting, and managing in any organisation, whether for-profit, not-for-profit or governmental.

Unit 1: Introduction to accounting
You'll begin by being introduced to the scope and structure of the module and the purpose of bookkeeping and accounting, as well as the skills, knowledge and ethics required for accounting.
Unit 2: Essentials of double-entry bookkeeping
You'll be introduced to the key principles of the double-entry bookkeeping system, which is based on the accounting equation.
Unit 3: Accruals accounting explored
You'll develop an understanding of recording a wide range of transactions through ledger accounts.
Unit 4: Control over the ledgers  
This introduces the books of original entry that underpin ledger accounts as well as the different ways that ledger accounts are monitored, controlled and corrected.
Unit 5: Preparing financial statements
You'll revisit end-of-period adjustments and how they are used to prepare financial statements. You'll learn how to derive useful information from incomplete records and how to prepare manufacturing accounts.
Unit 6: Essentials of cost and management accounting  
You'll be introduced to the basic concepts and principles of management accounting, including cost analysis, accounting control systems and cost bookkeeping. You'll also cover the differences between manual and computerised accounting systems.
Unit 7: Management accounting applications
You'll consider some important management accounting applications, applying the concepts and principles of management accounting introduced in Unit 6.
Unit 8: Preparing for the exam
The final unit is designed to help you revise the module teaching materials and prepare for the end-of-module examination.

There will also be a tutorial on incomplete records, and you’ll have access to video tutorials on suspense accounts, bank reconciliations and control account reconciliations.

You will learn

You will learn the fundamental concepts and techniques of financial and management accounting as well as a range of relevant skills. These include double-entry bookkeeping, advanced numeracy, reading and analysing relevant case studies, using information and communication technologies, preparing appropriate reports and using and manipulating spreadsheets.

Professional recognition

This module is accredited by the International Association of Bookkeepers (IAB). 

On successful completion, you will be able to apply to become a Member of the IAB (MIAB). Conditions of accreditation and membership with the IAB, including any annual fees and the requirement for referees, need to be confirmed directly with the IAB.

Entry requirements

There are no formal entry requirements for this module. What is required is a commitment to developing already existing basic skills in numeracy and literacy. You are also expected to have a basic level of computer literacy and a broad interest in business and management.

If you have any doubt about the suitability of the module, please speak to an adviser.

What's included

You’ll also be provided with printed module books and have access to a module website, which includes:

  • a week-by-week study planner
  • online activities and resources
  • module materials
  • assessment guide
  • online tutorials and forums.

You will need

A non-programmable calculator. Some type of spreadsheet software is useful but not essential.

Computing requirements

You’ll need broadband internet access and a desktop or laptop computer with an up-to-date version of Windows (10 or 11) or macOS Ventura or higher.

Any additional software will be provided or is generally freely available.

To join in spoken conversations in tutorials, we recommend a wired headset (headphones/earphones with a built-in microphone).

Our module websites comply with web standards, and any modern browser is suitable for most activities.

Our OU Study mobile app will operate on all current, supported versions of Android and iOS. It’s not available on Kindle.

It’s also possible to access some module materials on a mobile phone, tablet device or Chromebook. However, as you may be asked to install additional software or use certain applications, you’ll also require a desktop or laptop, as described above.

Teaching and assessment

Support from your tutor

While you study this module you will be supported by tutors in online tutorials, many of which will be recorded. While you’re not obliged to attend any of these tutorials, you are strongly encouraged to take part.

Your tutor will also facilitate online discussions with your fellow students in your tutor group forum and will be available for individual queries and help if you need it. Your tutor will mark your tutor marked assignments and give you feedback on your progress.


The assessment details for this module can be found in the facts box.

If you have a disability

The OU strives to make all aspects of study accessible to everyone and this Accessibility Statement outlines what studying B124 involves. You should use this information to inform your study preparations and any discussions with us about how we can meet your needs.

Future availability

Fundamentals of accounting starts once a year – in October. This page describes the module that will start in October 2024. We expect it to start for the last time in October 2025.

Course work includes:

3 Tutor-marked assignments (TMAs)

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