Accounting for ProfessionalsCategory: Production & Objective Test
Two (2) parts: a production test administered and proctored at a designated school-site prior to the NLC and a 60-minute objective test administered onsite at NLC. Competitors must complete both parts for award eligibility.
Production Test Competencies: Financial statements; Bank reconciliation; Payroll; Trial balance; Journalizing; Depreciation; Adjusting/ closing entries
Objective Test Competencies: Accounts Concepts, Principles, Terminology; Audit Controls, Evidence, Procedures, and Reporting; Cost Accounting; Financial Accounting & Federal Income Tax; Financial Statements and Worksheets; Measurement and Presentation of Income and Expense Items; Measurement, Valuation, Realization/Recognition; Not-for-profit and Governmental Accounting; Ownership Structure and Valuation of Equity Accounts; Presentation of Assets and Liabilities; Professional Standards and Ethics
Skills: This event provides recognition for PBL members who demonstrate a comprehensive understanding of accounting, tax, and auditing principles
- Production test will constitute 50% of final event score.
- Objective test will constitute 50% of final event score.
Production Test Guidelines
- Documents produced for this event must be prepared by the competitor without help from the adviser or any other person.
- Administration of the production test is determined by the state chair/adviser.
- No calculators are allowed to be used on the production test.
- The production test score will be used to break a tie.
- Tests must be uploaded online by 11:59 p.m. Eastern Time on the third Friday in May.
- Desktop Publishing—the finished product must be uploaded in PDF format by 11:59 p.m. Eastern Time on the third Friday in May. Label all documents with the event title, competitor’s name, state, and school.
Objective Test Guidelines
- No materials may be brought to the testing site.
- Financial calculators may be used for accounting, finance, and analysis & decision making events; for all other events, calculators will be provided.
- Electronic devices must be turned off and out of sight.
The general event guidelines below are applicable to all national competitive events. Please review and follow these guidelines when competing at the national level. When competing at the state level, check the state guidelines since they may differ.
- Dues: Competitors must have paid PBL national and state dues by 11:59 p.m. Eastern Time on April 15 of the current school year.
- NLC Registration: Participants must be registered for the NLC and pay the national conference registration fee in order to participate in competitive events.
- Deadlines: The state chair, or designee, must register each state competitor on the official online entry forms by 11:59 p.m. Eastern Time on the second Friday in May.
- Each state may submit three (3) individuals in all events requiring only objective tests and two (2) individuals or teams for all events that require a pre-judged or performance component.
- Each competitor can compete in two (2) events.
- Each competitor must compete in all parts of an event for award eligibility.
- A team shall consist of two or three members. Exceptions are Parliamentary Procedure which must be a team of four or five members, and LifeSmarts which must be a team of two members.
Competitors are not permitted to compete in an event more than once at the NLC unless one of the following circumstances applies:
- Modified Events: A competitor may compete in the same event when the event is modified. Note, if the only modification is a name change, competitors may not compete in the renamed event.
- Team Events: One (1) competitor of the team may have competed in the same event at one (1) previous NLC; however, they may not compete more than twice in the event at the national level.
- Chapter Events: Competitors may compete in a chapter event more than once (Community Service Project).
- Individual Entry: A competitor who competed as an individual entry in a team event at the national level may compete in the same event a second time as part of a team, but not a second time as an individual.
- Parliamentary Procedure: Two (2) competitors of the team may have competed in this event at a previous NLC; however, they may not compete more than twice at the national level.
- Pilot Event: Competition in a pilot event does not disqualify a competitor from competing in the same event if it becomes an official competitive event. The participant may compete in another event as well as a pilot event.
- Objective Tests: Ties are broken by comparing the correct number of answers to the last 10 questions on the exam. If a tie remains, the competitor who completed the test in a shorter amount of time will place higher. If this does not break the tie, answers to the last 20 questions will be reviewed and determine the winner.
- Objective and Production Tests: The production test scores will be used to break a tie.
- Objective Tests and Performances: The objective test score will be used to break a tie based on the tie-breaking criteria of objective tests.
- Reports/Projects and Performances: The report/project scores will be used to break a tie.
- Performances: Judges must break ties and all judges’ decisions are final.
- State chair/adviser must register all competitors for NLC competitive events online by 11:59 p.m. Eastern Time on the second Friday in May.
- All prejudged components (report PDFs, resume/letter of application PDFs, and project URLs) must be received by 11:59 p.m. Eastern Time on the second Friday in May.
- All URLs and PDFs for prejudged projects and reports will be submitted by the state adviser via the competitive events registration form.
- All production tests must be received at FBLA-PBL by 11:59 p.m. Eastern Time on the third Friday in May.
- Desktop Publishing—the finished product must be uploaded in PDF format by 11:59 p.m. Eastern Time on the third Friday in May. Label all documents with the event title, competitor’s name, state, and school.
- All production tests must be uploaded online.
- State chair/adviser may make name changes only (no additional entries) by 11:59 p.m. Eastern Time on the first Friday in June. Competitor drops are the only changes allowed after this date and onsite.
The number of competitors will determine the number of winners. The maximum number of winners for each competitive event is 10. Only one (1) award is given to the schools competing in chapter events (Community Service Project and Local Chapter Annual Business Report).
- Financial calculators may be brought to objective testing and used for any accounting, finance, or analysis & decision making events.
- Certain events may allow the use of additional materials. Please refer to event guidelines.
Americans with Disabilities Act (ADA)
FBLA‑PBL meets the criteria specified in the Americans with Disabilities Act for all participants who submit a special needs form.
Recording of Presentations
No unauthorized audio or video recording devices will be allowed in any competitive event. Participants in the performance events should be aware the national association reserves the right to record any performance for use in study or training materials.
Graduate students may compete in all PBL events.
- Dress for Success—Members must be in business attire. Please review the the FBLA-PBL Dress Code. If you question if you are properly attired, then change.
- Read and follow explicitly the state and national competitive events guidelines. Be aware of differences between state and national guidelines.
- Check the status of membership dues. Students must be dues-paid members by April 15 to compete in national competition. The sooner dues are paid the sooner members will receive PBL benefits.
- All materials must be received by the national center by the second Friday in May. Normally the state submits these materials, but some states request the local chapters submit their reports, website URLs, interview materials, etc.
- Remember, when competing at the district or state levels, materials are not sent to the national office.
- Become completely familiar with the procedures to be followed for participation in each type of event at the state and national levels.
- Determine from the rating sheets and guidelines the areas that will be judged and the weight given to each area.
- Obtain a variety of updated information on different subject areas and provide access to students for study.
- Contact former and current chapter members who have competed in previous years for suggestions.
- Find mentors and other experts who can help members prepare for competition. Involve faculty, advisory committee members, Professional Division members, businesspeople, community volunteers, and parents in study sessions and event preparation.
- Try to recreate as realistically as possible the conditions under which the competition will take place and PRACTICE.
- Make certain that the copies of materials to be submitted to judges are error-free and in the proper format.
- Make sure all materials are submitted by the deadline.
- PBL members and advisers must recognize the value of competitive events, maintain a professional attitude toward the events, and keep them in proper perspective. While competitive events are an important element of PBL’s overall program, events are just a portion of the many other activities and programs that build a successful organization.
Tips for Computer Production Events
- The FBLA-PBL Format Guide may be used for Administrative Technology and Computer Applications. For these events you work for the company FBLA-PBL and the FBLA-PBL style manual is used in the workplace.
- Any software may be used to complete a production test.
- Each production event is comprised of two parts—computer production test at a test site designated by the state completed prior to NLC and an objective test administered at NLC. Check the guidelines to find out the weight for each part of the event.
- All national production tests must be submitted to the national center by the third Friday in May.
Sample Practice Materials
- Seven Internal Control Procedures in Accounting
- Income tax
- Presentation of contract assets and contract liabilities
2. Apply the steps in the Accounting cycle.
3. Post and analyze transactions using ledgers and journals.
4. Prepare a bank reconciliation and a proof of cash.
5. Explain the purpose of the sales journal and the accounts receivable ledger and post entries to both.
6. Explain the purpose of and prepare entries for the purchase order journal and accounts payable ledger.
7. Identify the fundamental principles of an accounting information system.
8. Discuss the development of accounting standards.
9. Journalize entries for cash and accounts receivable.
10. Apply the concepts of the time value of money.
11. Identify the components of the current asset cash.
12. Prepare journal entries for unearned revenue
13. Define and discuss key account and business terms such as bonds, audits, depreciation, amortization, and fixed assets, etc
14. Define the accrual basis of accounting and compare it to the cash basis of accounting.
2. Explain internal control practices.
3. Describe the techniques for investigating, interpreting, and appraising accounting records and assertions.
4. List and describe the general types of audit procedures for gathering evidence..
5. Apply internal design and evaluation strategies.
6. Describe the content and purpose of an audit plan.
7. Define and explain the differences among several types of frauds, errors, and illegal acts that might occur in an organization.
8. Explain auditors’ responsibilities with respect to detecting and reporting fraud.
9. Describe generally accepted auditing standards (GAAS) and explain how GAAS affect the audit team’s responsibilities.
10. Define the principle of reporting and identify the basic contents of the auditors’ report.
11. Define information risk and explain how auditing and assurance services play a role in reducing this business risk.
12. Provide an overview of the types of reports that accompany an entity’s financial statements.
13. Describe how the audit examination is affected by the fundamental principles of responsibilities and performance.
14. Explain the differences between internal and external auditors.
2. Identify the key features of a standard costing system.
3. Describe how cost accounting fits into an organization’s structure.
4. Illustrate the process of determining and setting standard costs.
5. Define standard cost variances for a variety of applications.
6. Prepare journal entries for standard cost application.
7. Define cost behavior.
8. Define and illustrate a cost object
9. Distinguish between direct costs and indirect costs.
10. Distinguish between fixed and variable overhead costs.
11. Define cost volume profit analysis.
12. Compute break-even point.
13. Define margin of safety.
14. Explain why different ways of computing product costs are appropriate for different purposes.
2. Discuss the conceptual framework underlying financial accounting.
3. Explain the difference between financial and managerial accounting.
4. Identify and properly classify the different taxpayers and types of taxes.
5. Define components of gross income.
6. Determine income adjustments and compute adjusted gross income.
7. Identify and complete the appropriate schedule for a given income item.
8. Identify, account for, and report properly capital gains and losses.
9. Identify and prepare the appropriate schedule for a given deduction item.
10. Identify and prepare schedules for miscellaneous tax items such as tax credits.
11. Compute and file personal income tax returns by identifying the tax base; determining personal exemptions, choosing whether to itemize deductions or elect the standard deduction; choosing whether to use the tax tables or the tax rate schedules; and deciding when to file, how to file, and how to minimize tax.
12. Establish the amount of taxes owed or the refund due based on payments already made to the governing institution.
13. Demonstrate the ability to determine appropriate use and proper computation of credit for the elderly, minimum and maximum taxes; earned income credit; child tax credit; Hope credit for educational expenses; and Lifetime learning credit for educational expenses.
14. Properly determine appropriate withholding for federal income tax.
15. File declarations of estimate tax properly.
16. Account for and report social security and self-employment tax.
2. Describe techniques for analyzing the flow of a business’s funds
3. Identify the various methods of selecting and interpreting financial ratios.
4. Analyze financial reports including income statements, the statement of cash flows, and the balance sheet.
5. Explain the basic elements of financial statements.
6. Define a budget and its major objectives.
7. Describe in general terms the budgeting process and key advantages.
8. Prepare the operating budget and its supporting schedules.
9. List the major components and items within each component of the income statement.
10. Prepare an income statement.
11. Classify economic resources as current, long-term investments, property, plant, or equipment, intangibles or other assets on the balance sheet.
12. Classify economic resources as current, long-term investments, property, plant, or equipment, intangibles or other assets on the balance sheet.
13. Prepare a statement of cash flows.
14. Use financial statements to analyze the operations of a company and make business decisions.
15. Prepare supporting worksheets.
2. Compute bad debt expense using the income statement approach and the balance sheet approach.
3. Prepare journal entries for the estimation of bad debts, the write-off of an account, and the recovery of a previously written off account.
4. Prepare journal entries to record a discounted note, the collection of a discounted note, and a dishonored note.
5. Apply the modified accrual basis of accounting the recording of typical transaction of a General or special revenue fund.
6. Describe the physical elements, controls, and costs that make up inventory valuation.
7. Distinguish between a periodic and a perpetual inventory system.
8. Compare inventory costing methods
9. Calculate turnover ratios.
10. Analyze obsolete, damaged, and slow-moving inventory
11. Define and illustrate capital expenditures vs. revenue expenditures
12. Analyze and journalize transactions of merchandise sold for cash, on account, or by credit card; post to proper ledger accounts; and prove subsidiary ledger by preparing a schedule of accounts receivable
13. Analyze and journalize purchases of merchandise on account; demonstrate knowledge of net purchases; post to proper ledger accounts; and prove subsidiary ledger by preparing a schedule of accounts payable
14. Prepare adjustments using aging accounts receivable, percentage of sales, and percentage of accounts receivable methods.
15. Explain the purpose of notes payable and notes receivable and calculate, record transactions, and journalize interest and payment of notes payable and receivable.
16. Record transaction journal entries related to accruals and deferrals.
17. Process sales orders and invoices for payment
18. Process accounts payable checks
19. Process sales returns and allowances.
20. Illustrate the preparation of a loan amortization table
2. Apply the concept of present value to market value of bonds.
3. Define the future and present value of money
4. Compute the present value and future value for a series of future cash flows.
5. Compute the premium or discount associated with a bond issue.
6. Evaluate alternatives related to a capital investment situation
7. Determine relevant cash inflows and outflows in applying discounted cash flow methods
8. Evaluate investments using the payback methods, the discounted rate of return, and the net present value method.
9. Explain the realization concept
10. Assign values to a transaction and/or event.
11. Summarize the value for a specific transaction in a given time period.
12. Calculate financial strength analysis by determining current ratio of assets to liabilities, acid-test ratio, debt ratio, working capital, equity ratio, and equity and earnings per share.
13. Apply differential analysis to make decisions such as buying or making a product; leasing or buying an asset; discontinuing a department, plant, or product; replacing or repairing equipment; or offering discounted prices on special orders.
14. Use other financial analysis tools, such as trend analysis, common-size statements, etc.
15. Calculate business profitability.
16. Explain and illustrate various depreciation issues including partial year depreciation, extraordinary repairs, fully depreciated assets, and switching depreciation methods.
2. Give an overview of financial reporting for nonbusiness entities.
3. Distinguish between private and public sector organizations.
4. Distinguish between private and public sector organizations.
5. Illustrate the basic financial statements for a state and local government.
6. Describe the basic accounts used by governmental funds.
7. Prepare journal entries for the expenditures cycle using both budgetary and activity accounts.
8. Prepare closing entries and classify fund balances within the framework of GASB Statement 54.
9. Prepare the fund basis financial statements for governmental and proprietary funds.
10. Contrast statements of cash flow prepared under GASB guidelines with those prepared under FASB guidelines.
11. Describe characteristics of private not-for-profit organizations and the accounting for contributors.
12. Apply the accrual basis of accounting in the recording of typical transactions of private not-for-profit organizations.
13. Define appropriations and encumbrances and contrast them to business financial statements.
14. Prepare the financial statements for private not-for-profit organizations.
15. Distinguish interfund transfers and transactions.
16. Describe the unique characteristics of audits of governmental and not-for-profit entities.
17. Describe the process of applying for tax exempt status and reporting requirements of the Form 990.
2. Determine stockholder’s equity and earnings per share.
3. Describe the purposes of the revenue, expense, and drawing accounts and illustrate the effects on capital/owners or stockholder’s equity.
4. Differentiate between stock splits and stock dividends and explain how each affects equity.
5. Discuss business organization structure and different types of corporations such as PC, LLC, and Subchapter S.
6. Explain the accounting implications for each type of business ownership.
7. Identify the business reporting and information flow required for each type of ownership
2. Journalize transactions affecting asset accounts.
3. Journalize entries for cash and accounts receivable.
4. Prepare plant asset records
5. Explain depreciation, depletion, and amortization.
6. Calculate and compare depreciation of property, plant, and equipment using various methods
7. Calculate and record the costs associated with the acquisition of property, plant, and equipment
8. Account for subsequent improvements of property, plant, and equipment.
9. Record the appropriate entries for the disposal of plant, property, and equipment for a realized gain or loss.
10. Explain the procedures for acquiring and accounting for natural resources.
11. Calculate depletion of natural resources.
12. Distinguish between tangible and intangible assets.
13. Identify the procedures for acquiring and accounting for intangible assets.
14. Discuss factors that must be considered in estimating the useful life of an intangible asset.
15. Estimate and record the value of purchased goodwill.
16. Illustrate the straight line, units of production, and double the declining balance methods of depreciation.
2. Identify the different entities that make ethics rules for CPAs and public accounting firms.
3. Analyze factual situations and decide whether an accountant’s conduct does or does not conform to rules of conduct established by the various professional accounting boards/offices.
4. Describe the general principles of the code of ethics for the AICPA, IMA, CIA, and ACAT.
5. Explain the importance of ethical business decisions.
6. Describe professional ethics for accountants in other areas including management accounting, internal auditing, and notfor-profit accounting.
7. Understand legal liability issues that accountants face and the impact that such issues have on professional ethics.
8. Recognize organizational structure and use chain of command. (could include the role of audit committees).
9. Exhibit knowledge of basic principles of supervision and leadership.
10. Set priorities and manage time efficiently in accordance with priorities.
11. Follow organizational policies and procedures.