Responsible Management Education

Book review of Schaum’s Outline of Theory and Problems of Financial Accounting

Book review of Schaum’s Outline of Theory and Problems of Financial Accounting

Prof Ranjit Tiwari



Shim and Siegel in their book on Theory and Problems of Financial Accounting have conceptualized and emphasized on all important topics of financial accounting in a clear and lucid manner. The manner of construction of the topic has bestowed clarity to the topic and enables the students to enhance their understanding of this discipline. The book also provides case-lets both solved and unsolved, to develop a student’s ability to solve problems that will contribute to their understanding of the issues, which one might face while studying financial accounting.

The book consists of sixteen chapters and subsequent to every three chapters; the book proposes demo examination for students, so that they can measure their progress on regular interval. The solutions to the questions asked in the proposed dummy examination, are provided in the book.

Shim and Siegel have structured the content of the book in concise format. The first three chapters introduce the students to the basics financial accounting, financial statements and analyzing and recording of financial transactions. Once the students are through with these basic concepts, of accounting, then they are starred through the topics of adjustment entries and accounting as applied in a merchandising business. In chapter 7 to 9, the essential components of current assets and current liabilities are discussed upon, which enables the students to understand the relevance of working capital requirements in a business. The next two chapters i.e. 10 and 11 are fully devoted on fixed assets and liabilities and subsequently in chapter 12 and 13, the concept of corporations and partnership businesses are discussed. In chapter 14 and 15 the authors concentrate on financial statements analysis and cash flow analysis while lastly, in chapter 16 the authors bring forth the issue of accounting dimensions of international business as the world economy has become truly internationalized and globalized.

Though the book is comprehensive and takes care of all important issues in accounting but as a teacher at post graduate level in management area I feel that the book has not given attention to the requirements of management students studying financial accounting, as real time case study collections have not been incorporated in the chapter plan of the book that could have stimulated students to think and tease their brains to come out with some innovative solution to the problems. However, the book is useful for conducting foundation courses in management level programme to impart the basics of financial accounting among students and also for individuals who are taking up the subject for the first time as well as for those who quickly want to revise the topics in financial accounting before proceeding to more advanced courses in accounting.