Log In
Log In
Led by Fra Luca de Pacioli Simulacrum
Eight tutorials on the foundations of accounting taught by Fra Luca de Pacioli, the Franciscan friar whose 1494 Summa was the first printed systematic treatment of double-entry bookkeeping — together with Cornelius Blott on the practical Victorian bookkeeping tradition and the Mesopotamian Sanga on the temple-account origins. Universal foundations applicable in any jurisdiction; the first course in the Universitas Accounting & Finance series.
Courses are available to holders of a paid pass or membership. See passes & membership →
Led by Fra Luca de Pacioli Simulacrum
The question
An orientation to what accounting is for, before any debits or credits. Pacioli Simulacrum walks through the four problems accounting solves (memory, control, measurement, trust) and why every commercial civilisation from Mesopotamian temples to modern London has needed it. The module distinguishes bookkeeping from accounting and management accounting from financial accounting, and identifies the stakeholders any particular set of accounts is serving. The closing exercise reads the books of a sole trader who has none.
Outcome
The student can articulate why accounting exists in their own words, name the four functions it serves, distinguish bookkeeping from accounting and management from financial accounting, and identify which stakeholders any particular set of accounts is serving. (Foundational orientation)
Practice scenarios
Your friend runs a small business — they make and sell ceramic homewares, mostly through markets and Etsy. Last year they took roughly £40,000 in revenue. They keep no accounting records. Receipts are in a shoebox; invoices are in their email; the business and personal accounts are mixed at the same bank. They have just been informed by HMRC that they are due to register for self-assessment, and a friend has suggested they will need to register for VAT soon. They have approached you because you've started studying accounting and they think you can help. Your job is *not* to do their books for them. Your job is to help them understand what they're missing and why.
Your goals
Led by Fra Luca de Pacioli Simulacrum
The question
The single equation that underpins every set of books in the world: Assets = Liabilities + Equity. The module covers the three terms and their definitions, the residual nature of equity, the way every transaction preserves the equation, the expanded form including retained earnings, and what *negative equity* means in the moment a firm becomes technically insolvent. The exercise classifies a messy list of items into the three categories and traces a sequence of transactions through the equation.
Outcome
The student can state the accounting equation, define its three terms, classify any item as asset/liability/equity, demonstrate how a sequence of transactions preserves the equation, and recognise the moment a business becomes technically insolvent. (The equation)
Practice scenarios
A friend has handed you a list of items from their start-up's first month and asked you to classify each one as Asset, Liability, or Equity, and explain why. The list: (1) £10,000 of their own money put into the business bank account; (2) a laptop bought for £1,200; (3) £3,000 of inventory bought on 30-day credit from a supplier; (4) £500 of inventory sold for £800 cash; (5) a £15,000 loan from their parents; (6) £400 of unpaid wages for the part-time helper at month-end; (7) £2,000 of inventory still on the shelves; (8) the £200 customer deposit for an order to be fulfilled next month; (9) a £50 monthly software subscription paid for the month just ended; (10) the brand name they've trademarked and registered.
Your goals
Led by Fra Luca de Pacioli Simulacrum
The question
The two faces of every transaction — and the rules of debit and credit applied to the five account types (assets, liabilities, equity, revenues, expenses). The module covers the DEAD CLIC mnemonic, the journal entry as canonical form, why revenue accounts behave like equity accounts and expense accounts like negative-equity, and worked examples for the dozen most common transactions a small business sees. The closing exercise journals twelve transactions from a week of trading.
Outcome
The student can write a journal entry for any of the dozen most common transactions (cash sale, credit sale, cash purchase, credit purchase, payment to supplier, receipt from customer, taking a loan, repaying a loan, paying wages, paying rent, depreciation, owner's drawing), demonstrate that total debits equal total credits, and apply the DEAD CLIC mnemonic without reference. (Double-entry mechanics)
Practice scenarios
You will write the journal entries for a sequence of twelve transactions in your friend's first month of business (the same friend from Module 2). The transactions: (1) Owner deposits £10,000 into business bank. (2) Buys laptop for £1,200 cash. (3) Buys £3,000 inventory on 30-day credit. (4) Sells inventory cost £500 for £800 cash. (5) Pays £600 cash to the supplier (partial settlement). (6) Takes £15,000 loan from parents into bank. (7) Pays £400 wages cash. (8) Receives £200 customer deposit cash. (9) Pays £50 software subscription cash. (10) Owner takes £500 cash for personal use. (11) Receives £700 cash from a customer for goods sold last week (no invoice yet recorded). (12) Records £100 depreciation on the laptop for the month.
Your goals
Led by Cornelius Blott Simulacrum
The question
What you do with a journal entry once you have written it. The module covers the journal as chronological record and the ledger as account-organised record, T-accounts and running balances, the chart of accounts, the trial balance and what it does and does not prove, the half-dozen errors a balanced trial balance does not catch, and suspense accounts when the trial balance won't balance. The exercise diagnoses a trial balance that refuses to balance.
Outcome
The student can post a sequence of journal entries to the ledger, draw up T-accounts with running balances, produce a trial balance, and identify which kinds of errors a balanced trial balance does not detect. (Journals, ledgers, trial balance)
Practice scenarios
A small business has just produced its first month-end trial balance and it does not balance. The total of the debit column is £47,830; the total of the credit column is £47,920 — a difference of £90. The bookkeeper insists every journal entry was posted correctly. Your job is to walk through the work and find the error before the owner sees the books and panics.
Your goals
Led by Fra Luca de Pacioli Simulacrum
The question
The first of the two financial statements you can produce from a trial balance. The module covers the income statement as performance measurement over a period, the principles of revenue recognition (earned, not received) and matching (expense recognised in the same period as related revenue), accruals vs cash basis, the standard structure (Revenue → COGS → Gross Profit → Operating Expenses → Operating Profit → Finance Costs → PBT → Tax → Profit), the three margins, and why profit and cash are not the same number. The exercise applies revenue recognition to specific scenarios.
Outcome
The student can produce an income statement from a list of revenues and expenses, apply the revenue recognition and matching principles to specific transactions, calculate gross / operating / net margin, and explain why profit and cash are not the same number. (Income statement)
Practice scenarios
A construction company has just completed a six-month contract on 31 March worth £600,000. Under the contract: a £60,000 deposit was paid on signing in October; £200,000 was paid in two stage payments in December and February; the final £340,000 will be paid in monthly instalments of £20,000 over the next 17 months. Materials cost £180,000 (paid throughout); labour cost £240,000 (paid in monthly wages); overheads £40,000 (rent, fuel, supervision over the six months). Profit on the contract is £140,000. The CEO wants to know: what gets reported in the year-end income statement on 31 March?
Your goals
Led by Fra Luca de Pacioli Simulacrum
The question
The balance sheet as the snapshot of where a business stands at a moment, supported by the accounting equation that runs through it. The module covers the standard categories (PPE, intangibles, investments, inventory, receivables, cash; trade payables, accruals, deferred income, loans, deferred tax; share capital, share premium, retained earnings, reserves), the current vs non-current 12-month rule, the three ratios (current, quick, gearing), and the three diagnostic questions of solvency, liquidity, and structure that a competent reader asks. The exercise reads a published balance sheet.
Outcome
The student can produce a balance sheet from a trial balance, classify items correctly between current and non-current, calculate the current ratio, quick ratio, and gearing ratio, and read a published balance sheet asking the three questions of solvency, liquidity, and structure. (Balance sheet)
Practice scenarios
You have been handed the latest balance sheet of a real UK private company — a profitable, growing manufacturer with revenues of £8 million. The numbers (£000s): non-current assets 5,200 (PPE 4,800, intangibles 400); current assets 2,100 (inventory 850, receivables 950, cash 300); non-current liabilities 3,400 (long-term bank loan); current liabilities 1,800 (trade payables 1,100, short-term borrowings 400, current tax 300); total equity 2,100 (share capital 100, retained earnings 2,000). The owner-director is asking your view on three questions: is the business solvent, is it liquid, and is the funding structure healthy?
Your goals
Led by Fra Luca de Pacioli Simulacrum
The question
Why the cash flow statement is indispensable — profit is not cash, and neither the income statement nor the balance sheet tells you how cash actually moved through the business over the period. The module covers the three sections (operating, investing, financing), the indirect method that dominates UK practice, how depreciation and impairments add back, how working-capital changes consume or release cash, and the diagnostic patterns of a healthy mature firm versus a growing, distressed, or financially-engineered one. The closing scenario reads a profitable business in trouble.
Outcome
The student can construct a cash flow statement using the indirect method, distinguish operating, investing, and financing cash flows, identify the working-capital changes that drive the divergence between profit and cash, and read the diagnostic pattern of a published cash flow statement. (Cash flow statement)
Practice scenarios
You are advising a friend on a business they have been asked to invest in. The numbers look attractive: revenue £4.5m (up from £3.2m last year), profit before tax £680k (a healthy 15% margin). But the founder is asking for £400k of working-capital funding "to bridge a gap". Looking at the cash flow statement: operating cash flow is *negative* £150k. Investing activities show £200k of capex. Financing: £100k new bank facility drawn, £80k owner loan, no dividends. You're worried.
Your goals
Led by The Sanga Simulacrum · with Fra Luca de Pacioli Simulacrum
The question
A closing tour of accounting across five thousand years — the proto-cuneiform of Uruk c. 3300 BCE as the origin of writing, Mesopotamian temple accounting, the four-hundred-year evolution of double-entry in medieval Italian city-states, Pacioli Simulacrum's role as systematiser rather than inventor, the spread to northern Europe and the joint-stock corporation, the Industrial Revolution and the rise of management accounting, and the twentieth-century financial-reporting standards. The exercise asks the student to explain accounting to a five-year-old.
Outcome
The student leaves with a sense of accounting as a deep human practice rather than a recent invention, a working knowledge of its key historical milestones, and an understanding of why the system they have learned has no serious competitor.
Practice scenarios
Your child (real or imagined; aged five or six, bright and curious) has noticed that you've been studying for weeks and asks, "What is accounting? Why do you have to learn it?" The Sanga Simulacrum, watching, will press you to give an answer that is honest, that doesn't talk down, and that captures something true about why this practice has been with humans for five thousand years. The Feynman test: if you can't explain it to a child, you don't understand it.
Your goals