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Accounting and Investments

Course developer

Replaced course

Ekon2126 [GEKO2130] Accounting and Investments

Course abstract

The aim of the course is to learn the basics of accounting and investment opportunities in agriculture. Students learn the basics of accounting, the company's financial accounting in the double-entry system and tax accounting, get acquainted with the basic principles of accounting, the company's assets and their sources, accounting objects, asset evaluation methods, as well as with the reflection of income and expenses in the simple-entry system. Students gain an understanding of investments in agriculture, as well as the types of state and EU support available for agriculture and rural development and the conditions of financing, as well as get acquainted with investment support measures in practice.

Learning outcomes and their assessment

1) Knows and understands the accounting and tax calculation and payment procedures and related terms - independent work, control tasks
2) Knows and understands the need for company accounting, the duties and rights of the taxpayer - independent work, control work
3) Knows and understands the types of investments and their role in agriculture and rural development - practical work, independent work, control work, presentation
4) Can apply acquired theoretical and practical knowledge, connect theory with practice - practical work, independent work, control work, presentation
5) Can independently prepare the balance sheet, profit or loss statement and cash flow of a small agricultural company - practical work, independent work, control work
6) Can calculate various taxes - practical work, independent work, control work
7) Knows tax benefits in agriculture - practical work, independent work, control work
8) Knows the types of investments and their sources for agricultural and rural development - practical work, independent work, presentation.
9) Able to responsibly plan assigned tasks - independent work, presentation
10) Able to select information, present and argue the expressed proposals - independent work, presentation

Course Content(Calendar)

Part I Accounting
1. Accounting, its importance and requirements. The essence of accounting, tasks. Users of accounting data. Laws regulating accounting and their basic requirements. Organization of accounting work in the company. Accounting objects. Financial accounting subject. Management accounting subject. Registration of economic operations. The concept and importance of a document in accounting. (1 lecture, 2 practical works)
2. Accounting balance sheet and its structure. Concept of balance. Balance structure. Changes in balance sheet items (2 lectures, 4 practical exercises)
3. Accounting accounts and their general structure. The concept of accounts and their general structure. Structure of balance accounts. Structure of operating accounts. Structure of the profit or loss account. Synthetic and analytical accounts. Bookkeeping of economic operations in the double entry system, correspondence of accounts. Chart of accounts and its preparation (1 lecture, 2 practical works)
4. Accounting of wages. Payroll taxes. Mandatory State Social Insurance Contributions (VSAOI). Personal income tax. (1 lecture, 2 practical works)
5. Cash accounting. Cash flow statement. Accounting of requirements and obligations (1 lecture, 1 practical work, 1 hour - test)
6. Inventory accounting. Composition of stocks and necessary information about them. Inventory of purchased stocks. Inventory of self-produced products. Pet Accounting Organization Inventory Valuation Methods (Weighted Average, FIFO, Lowest Market Price). Accounting for long-term investments. The nature, composition and accounting requirements of long-term investments. Accounting of fixed assets and their creation. Calculation and accounting of depreciation of fixed assets. (1 lecture, 2 practical works)
7. Equity accounting. Accounting of income and expenses of economic activity. Calculation of profit or loss. Content, preparation, approval and submission of the financial statement. (1 lecture, 2 practical works)
8. Taxes and fees system in Latvia. Value-added tax. Corporate income tax. Business light vehicle tax. Property tax. Other taxes. Tax incentives in agriculture. (1 lecture, 3 practical works)
9. Laws and regulatory documents governing simple entry accounting. Accounting in simple entry accounting. Declaration of annual income. VSAOI of self-employed persons (1 lecture, 2 practical works, 1 hour - test)
Part II Investments
10. Concept of investment. Types of investments. Agriculture and rural development policy in Latvia. State and EU support for agriculture and rural development, its regulatory framework. National subsidies. EU direct payments, their allocation and administration procedure (4 lectures, 2 practical works).
11. Common agricultural policy (CAP), its historical development and reforms. CAP budget and measures. The importance of support in the financial stabilization of companies and the success of investments. Purpose and conditions of receipt of direct payments (Pillar I). Rural development (pillar II) support purpose and financing options. Agricultural goods market regulation and support measures (4th lecture).
12. CAP in Latvia. Economic, environmental and social objectives of the CAP. Support for young farmers. De minimis aid. Investments in tangible assets. Support for investments in farms. Support for investment in recycling. Support for investments in infrastructure (2 lectures, 2 practical works, 2 - presentations).
13. Loans and guarantees for rural entrepreneurs. Specifics of agricultural lending. Types of loans. Leasing and its types. State and EU support for investment promotion in agriculture. Support for partial coverage of credit interest for the producer of primary agricultural products. Latvian Land Fund. (2 lectures, 2 - presentations).
14. Tax rebates for the promotion of investments in agriculture. Excise duty relief for diesel fuel. Real estate tax for agricultural land (2 lectures, 2 practical works, test).

Requirements for awarding credit points

At the end, you have to take an exam on the topics learned in the course. Students can receive cumulative assessment if the average assessment is at least 6 points. The accumulative assessment consists of the evaluation of the test (2 x 25%), independent work (10%), presentation (30%) and test (10%).
1) test: Accounting objects, accounting balance. Calculation of wages;
2) control work: Inventory of fixed assets and stocks. Calculation of profit or loss and value added tax;
3) independent work - Cash flow planning;
4) presentation - LR and EU support payments for agriculture and rural development;
5) test - investments in agriculture.

Description of the organization and tasks of students’ independent work

1) independent work - the student must plan the cash flow for a new agricultural enterprise. Cash flow should be planned in the form of an Excel table for the calendar year in total and broken down by month. Submission of works in e-studies.
2) presentation – the student should choose one of the state or EU support measures for agriculture or rural development, study its purpose and conditions, as well as evaluate how actively farmers use it in the last 3-4 years, and prepare a 5-7 minute presentation, e.g. , using PowerPoint.

Criteria for Evaluating Learning Outcomes

All works must be completed. Each work is graded. The evaluation of the study course depends on the evaluation of independent works, tests and the exam, 10% corresponds to one point on the 10-point study results evaluation scale.

Compulsory reading

1) Leibus I. Uzņēmuma darbības uzsākšana, grāmatvedība un nodokļi. Rīga: Lietišķās informācijas dienests, 2022, 175 lpp.
2) Leibus I., Grigorjeva R., Jesemčika A., Svarinska A. Grāmatvedības pamati uzņēmumos. Rīga: Lietišķās informācijas dienests, 2019, 195 lpp.
3) Leibus I., Pētersone I., Jesemčika A., Svarinska A., Grigorjeva R. Finanšu grāmatvedība. SIA Lietišķās informācijas dienests, Rīga, 2020, 318 lpp.
4) Leibus I. Pašnodarbināto grāmatvedība un nodokļi. Rīga: Lietišķās informācijas dienests, 2022, 151 lpp.
5) Lauksaimniecības gada ziņojumi, ZM, ikgadējs

Further reading

1) Berkeley Hill. An Introduction to Economics. Concepts for Students of Agriculture and the Rural Sector. 5th Edition. Cabi, www.cabi.org, 2021, p 256.
2) Grebenko M. Darba likums un grāmatvedība. Rīga: Lietišķās informācijas dienests, 2018
3) Kelmere L. Ievads grāmatvedībā jeb Grāmatvedības pamati: teorija un uzdevumi. Rīga: Lietišķās informācijas dienests, 2022, 280 lpp.
4) Matule I. Grāmatvedības organizācijas dokumenti – izstrādāšanas rokasgrāmata. Rīga: Lietišķās informācijas dienests, 2016

Periodicals and other sources

1) Agrotops, žurnāls.
2) Bilance, Rīga: Lietišķās informācijas dienests
3) iFinanses.lv, Rīga: Izdevniecība iŽurnāli, Elektronisks žurnāls.
4) plz.lv Rīga: Lietišķās informācijas dienests, Elektronisks žurnāls.
5) Kopējā lauksaimniecības politika https://agriculture.ec.europa.eu/common-agricultural-policy/financing-cap/cap-funds_en#overview
6) Latvijas Valsts Agrārās ekonomikas institūta mājaslapa https://lvaei.lv/
7) Lauku atbalsta dienesta mājaslapa www.lad.gov.lv
8) LR likumi un MK noteikumi / www.likumi.lv
9) Valsts ieņēmumu dienesta mājaslapa www.vid.gov.lv
10) Zemkopības ministrijas mājaslapa www.zm.gov.lv

Notes

Professional Bachelor's Degree Programme “Agriculture”