Topics: Balance sheet, Inventory, Management Pages: 26 (5535 words) Published: October 19, 2014
[Updated as at August 2013]

Supplementary Notes for BAFS Curriculum
(To be effective for the 2014 and 2015 HKDSE examinations)
** Updated items are highlighted in YELLOW.
1. Formulae of Ratios
2. Accounting Terminology

Compulsory Part
1(a) Business Environment
Hong Kong

Learning Elements Specified in C&A Guide
Explanatory Notes
(i) Describe the role and importance of business in the Hong Kong economy.
(ii) Analyse the recent development and characteristics of the Hong Kong economy.

Supplementary Teaching Notes

Characteristics of Hong Kong’s economy include:
lack of primary industries, dependence on external trade,
concentration on tertiary industry, free trade, simple

(iii) Evaluate how economic, technological, cultural,
physical, social, political and legal factors affect business decisions.
(iv) Describe Hong Kong’s economic and business
relationships with the Mainland.


Relationships include economic cooperation, e.g. CEPA,
trading partners, sources of capital

(v) Be aware of the economic policies and general business
practices in the Mainland.


Only basic, broad-brush knowledge about CEPA is required
Details about policies and practices are not required

Page 1 of 26

[Updated as at August 2013]


Learning Elements Specified in C&A Guide
Explanatory Notes
(vi) Describe the impact of globalization on business.

Supplementary Teaching Notes
Impacts: e.g. keen competition, international flow of
capital and information, global sourcing and outsourcing,
technology transfer

(vii) Explain the roles of major international trade
Forms of



Students are only required to explain the major functions of WTO and APEC

(i) Distinguish between the major forms of business
ownership: sole proprietorship, partnership, limited
company, joint-venture, franchise and public enterprise.


Characteristics of ‘general, limited and nominal partners’ are required
Set up procedures of different forms of business ownership
and related documents are not required


(ii) Evaluate the pros and cons of the different forms of
business ownership.
(iii) Compare the characteristics of small and medium
enterprises and multinational corporations in Hong Kong.
Business Ethics
and Social


Comparison of characteristics in terms of the firms’ size, forms of ownership and source of capital


Suggested to be learning and teaching activities to enhance
awareness and knowledge about business ethics and social

(i) Explain why and how a business should be ethically
responsible to various stakeholders.
(ii) Describe how business ethics and social responsibilities affect business decisions.
(iii) Explain the principles and objectives of corporate
governance, and appreciate the importance of good
corporate governance.

Page 2 of 26

[Updated as at August 2013]

1(b) Introduction to Management

Learning Elements Specified in C&A Guide
Explanatory Notes
(i) Explain the importance of management.

Supplementary Teaching Notes

(ii) Demonstrate a basic understanding of the following
management functions for organisations: planning,
organising, leading and controlling.


Planning: importance, planning process and characteristics
of SMART goals

(i) Illustrate the major management skills required of

(ii) Apply the following principles of effective management: division of work, unity of command, unity of direction,
authority and responsibility, and management by
Key Business

(i) Describe the role and importance of the following key
functional areas in business: human resources
management, financial management, operations
management, marketing management, information
management and risk management.

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