Abstract:

Financial Instruments (FI) is always perceived as a complex standard, especially for users and preparers of financial statements. This article contends that it is not the subject matter that is dry, but rather the methods in which the standards have been taught. Therefore, the objective of this paper is to discuss a creative approach of teaching FI as well as promoting independent learning via FI Kit. This will help students to understand the FI concept and its link to exam questions. Therefore, student’s motivations and confidence in learning the financial reporting (FR) subject can increase, leading to higher chances passing the FR papers. In traditional approach, most textbook will start with the explanation using the following steps; recognition of FI, measurement of FI, classification of FI and presentation of FI (traditional model). Due to this flow, students are taught on the measurement of transaction cost before they were introduced to FI classification. However, the correct treatment of transaction cost depends on the classification. Thus, it will be best to introduce the classification first. Other issues with this flow, students have an idea that FI is another item other than asset, liabilities or equity. Therefore, the new approach proposed the following steps: presentation, recognition, classification and measurement to solve the issues. In addition, a simulation kit was built together with this approach to support the digital learning. Based on this new model, students perform well for their class exercise, spend less time on question and answer session and require less guidance. This new model will also help to simplify the complexity and removing paper-based information (eliminating the textbook for reference) towards digitalization.

Keywords:

Financial Instruments, Financial Reporting, Accounting Standard, Teaching Technique, FI Kit.