Accounting for Non-Accounting Students 9th edition by John R. Dyson solution manual

than the tax they attempted to save, once HM Revenue and Customs (HMRC) has successfully
challenged them”.
Tax evasion is simply the avoidance of paying tax which is legally due. This is done by such
methods as manipulating profits or not declaring sources of income so that the reported level of
Crawford et al., Accounting for Non-Accounting Students, 9 th edition, Instructor’s Manual
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income is lower than it actually is. Tax evasion is not a manipulation of tax rules but a failure to
declare correct income and is illegal.
Tax evasion is not justifiable due to its illegality but tax avoidance is a moot point. Those that
engage in tax avoidance would probably argue that they are using the tax rules to their
advantage and not actually breaking the law although their actions may not be within the spirit
of the law.
1.11
In answering this question, students should be encouraged to explore in depth the nature and
purpose of accounting. It is hoped that by doing so it will become obvious why it would be
useful for Joseph Sykes (and other non-accountants) to study the subject.
1. The main function of accounting is to collect information and then to store, extract,
summarise and report it to those parties who have a need and a use for it.
2. It is a service function: it is supposed to assist other managers who have neither the time nor
the expertise to search for the information themselves.
3. Some information is necessary to satisfy various statutory and professional requirements.
Such requirements cannot be ignored, no matter how irksome they may appear to non-
accounting managers.
4. Information of whatever type is not always easy to understand. Accounting information is
no exception. If Joseph Sykes has undertaken an accounting course, he will be much better
placed to appreciate the potential usefulness of accounting information in his job because,
he will have a sound understanding of where it comes from, how it has been compiled and
of its inherent deficiencies.
5. When he becomes a director of the company, Joseph will be legally responsible for the
company’s accounting records and systems, and reporting procedures. This is a heavy
burden and he will need to know the extent of his responsibilities. The ‘buck’ stops with the
directors – even if they are not accountants.
1.12
The main purpose behind this question is to illustrate that accounting is not solely a product of
profit-making enterprises, but that it has a use in all sectors of the economy, irrespective of
which type of entity is involved.
1. Purpose of accounting: planning, control and decision making.
2. Essential that funds go to the main work of the charity and are not lost in administration.
3. If properly implemented and operated, accounting can help in the efficient use of resources.
4. Not administration for administration’s sake.
5. Provides assurance that voluntary contributions go where they are meant to go.