THEME : BASIC ACCOUNTING
SUBJECT :
ACCOUNTING
ACCOUNTING
BASIC ACCOUNTING
Accounting
is the process of identifying,
measuring, and communicating economic information to permit informed judgements
and decisions bu users of the information.
is the process of identifying,
measuring, and communicating economic information to permit informed judgements
and decisions bu users of the information.
Accounting
measures the results of an organization’s economic activities and conveys this
information to a variety of users, including investors, creditors, management,
and regulators.
measures the results of an organization’s economic activities and conveys this
information to a variety of users, including investors, creditors, management,
and regulators.
The
history of accounting dates back to ancient Mesopotamia for its writing,
counting , and money. There is also evidence of early forms of bookkeeping in
ancient Iran, and early auditing systems by the ancient Egyptians and
Babylonians.
history of accounting dates back to ancient Mesopotamia for its writing,
counting , and money. There is also evidence of early forms of bookkeeping in
ancient Iran, and early auditing systems by the ancient Egyptians and
Babylonians.
OBJECTIVES OF ACCOUNTING
The
main object of Accounting is to ascertain
the results of the financial transactions of a business concern.
main object of Accounting is to ascertain
the results of the financial transactions of a business concern.
13
objectives that accounting serves :
objectives that accounting serves :
1.
Identification
and recording of transactions.
Identification
and recording of transactions.
2. Ascertainment of results at
the end of a particular period, is it profit or loss.
the end of a particular period, is it profit or loss.
3. Ascertainment of financial affairs, such as
debt-liabilities, property, and assets by preparing a balance sheet.
debt-liabilities, property, and assets by preparing a balance sheet.
4. Keeping accounts of cash.
5. Control over assets and
liabilities.
liabilities.
6. Controlling money defalcation
and cost.
and cost.
7. Providing economic data.
8. Helping tax fixation.
9. Determination and evaluation
of policy.
of policy.
10. Testing the arithmetical
accuracy of accounts.
accuracy of accounts.
11. Acceptability to others.
12. Creation of values and
accountability.
accountability.
13. Following legal bindings and
prohibition, such as partnership law, income tax law, and company law.
prohibition, such as partnership law, income tax law, and company law.
ROLE OF
AN ACCOUNTANT
AN ACCOUNTANT
An accountant performs financial functions related to the
collection, accuracy, recording, analysis and presentation of a business,
organization or company’s financial operations.
collection, accuracy, recording, analysis and presentation of a business,
organization or company’s financial operations.
In a smaller business, an accountant’s role may consist of
primarily financial data collection, entry and report .
primarily financial data collection, entry and report .
USERS OF
ACCOUNTING INFORMATION
ACCOUNTING INFORMATION
Internal Users
1.
Top management
Top management
2.
Middle Management
Middle Management
3.
Lower Management
Lower Management
They need financial information to guide them in doing
their tasks and in making informed decisions that affect the operations of the
company.
their tasks and in making informed decisions that affect the operations of the
company.
External Users
1.
Stockholders and potential
stockholders.
Stockholders and potential
stockholders.
2.
Bondholders, bankers, and other
creditors.
Bondholders, bankers, and other
creditors.
3.
Government agencies, in order to
collect tax on income from both individuals and corporation.
Government agencies, in order to
collect tax on income from both individuals and corporation.
4.
Suppliers or Trade Creditors
Suppliers or Trade Creditors
5.
Employees and Labor Union
Employees and Labor Union
6.
Customers
Customers
7.
Others, such as Analysts,
Researchers, Students, Media Reporters, and Publishers.
Others, such as Analysts,
Researchers, Students, Media Reporters, and Publishers.
ACCOUNTING
CAREERS
CAREERS
Practitioners of accounting are known as accountants. Jobs
related in accounting are :
related in accounting are :
–
Accountant
Accountant
–
Accounting Assistant, entry-level
finance professionals who handle basic accounting duties, such as preparing
financial records, conducting office administration, and handling cash.
Accounting Assistant, entry-level
finance professionals who handle basic accounting duties, such as preparing
financial records, conducting office administration, and handling cash.
–
Accounting Clerk, responsible for
reviewing and maintaining accounting records.
Accounting Clerk, responsible for
reviewing and maintaining accounting records.
–
Accounting Manager, responsible for
developing and maintaining the accounting systems and procedures that
accountants use to collect, analyze and verify an organization’s financial
data.
Accounting Manager, responsible for
developing and maintaining the accounting systems and procedures that
accountants use to collect, analyze and verify an organization’s financial
data.
–
Accounts Payable Clerk, his duties
are to charges expenses to accounts and cost centers by analyzing
invoice/expense reports; recording entries; pays employees by receiving and
verifying expense reports and request for advances; preparing checks; maintain
accounting ledgers by verifying and posting account transactions.
Accounts Payable Clerk, his duties
are to charges expenses to accounts and cost centers by analyzing
invoice/expense reports; recording entries; pays employees by receiving and
verifying expense reports and request for advances; preparing checks; maintain
accounting ledgers by verifying and posting account transactions.
–
Accounts Receivable Clerk is an
entry-level accounting professional who specializes in accurately recording
financial transactions that generate revenue for their organization.
Accounts Receivable Clerk is an
entry-level accounting professional who specializes in accurately recording
financial transactions that generate revenue for their organization.
–
Bookkeeping, keeping records of the
financial affairs or business.
Bookkeeping, keeping records of the
financial affairs or business.
–
Budget Analyst, help public and
private institutions organize their finances.
Budget Analyst, help public and
private institutions organize their finances.
–
Certified Internal Auditor, is the
internal audit profession’s that certified by Institute of Internal Auditors.
Certified Internal Auditor, is the
internal audit profession’s that certified by Institute of Internal Auditors.
–
Chief Financial Officer – CFO, is the
officer of a company that has primary responsibility for managing the company’s
finances, including financial planning, management of financial risks,
record-keeping, and financial reporting.
Chief Financial Officer – CFO, is the
officer of a company that has primary responsibility for managing the company’s
finances, including financial planning, management of financial risks,
record-keeping, and financial reporting.
–
Controller, is the chief accounting
officer and plays an important role in heading the entire accounting
department.
Controller, is the chief accounting
officer and plays an important role in heading the entire accounting
department.
–
Government Accounting, refers to the
process of recording and management of all financial transactions incurred by
the government which includes its income and expenditurea.
Government Accounting, refers to the
process of recording and management of all financial transactions incurred by
the government which includes its income and expenditurea.
–
Payroll Clerk, assists in the process
of making sure a company pays employees accurately and on time. Payroll clerks
collect and organize time sheets and enter information related to employees and
pay periods into a computer.
Payroll Clerk, assists in the process
of making sure a company pays employees accurately and on time. Payroll clerks
collect and organize time sheets and enter information related to employees and
pay periods into a computer.
–
Staff Accountant, is a trained
professional who works for accountng firms, government agencies and non-profit
organizations.
Staff Accountant, is a trained
professional who works for accountng firms, government agencies and non-profit
organizations.
–
Tax Accountant, use their skills and
knowledge of tax legislation and regulations to provide assistance to their
clients or employers in paying taxes in the most efficient and beneficial way
possible, always complying with government laws and procedures.
Tax Accountant, use their skills and
knowledge of tax legislation and regulations to provide assistance to their
clients or employers in paying taxes in the most efficient and beneficial way
possible, always complying with government laws and procedures.
FIELDS OF ACCOUNTING
Accounting can be devided into
several fields, there are:
several fields, there are:
1.
Financial Accounting, focuses on the reporting
of an organization’s financial information, including preparation of financial
statements.to the external users of the information, such as inventors,
regulators and suppliers.
Financial Accounting, focuses on the reporting
of an organization’s financial information, including preparation of financial
statements.to the external users of the information, such as inventors,
regulators and suppliers.
2.
Public Accounting, firms of
accountants that serve clients such as businesses
Public Accounting, firms of
accountants that serve clients such as businesses
3.
Government Accounting refers to the
process of recording and the management of all financial transactions incurred
by the government which includes its income and expenditures.
Government Accounting refers to the
process of recording and the management of all financial transactions incurred
by the government which includes its income and expenditures.
4.
Forensic Accounting, the use of
accounting skills to investigate fraud or embezzlement and to analyze financial
information for use in legal proceedings.
Forensic Accounting, the use of
accounting skills to investigate fraud or embezzlement and to analyze financial
information for use in legal proceedings.
5.
Management Accounting, focuses on the
measurement, analysis and reporting of information for internal use by
management.
Management Accounting, focuses on the
measurement, analysis and reporting of information for internal use by
management.
6.
Tax Accounting, focuses on taxes
rather than appearance of public financial statements.
Tax Accounting, focuses on taxes
rather than appearance of public financial statements.
7.
Cost Accounting, a systematic set of
procedures for recording and reporting measurements of the cost of
manufacturing goods and performing services in the aggregate and in detail.
Cost Accounting, a systematic set of
procedures for recording and reporting measurements of the cost of
manufacturing goods and performing services in the aggregate and in detail.
8.
Internal Auditing, an independent,
objective assurance and consulting activity design to add value and to improve
an organization’s operations.
Internal Auditing, an independent,
objective assurance and consulting activity design to add value and to improve
an organization’s operations.
ETHICS OF AN ACCOUNTANT
1.
Integrity, straight forward and
honest in all professional and business relationship.
Integrity, straight forward and
honest in all professional and business relationship.
2.
Objectivity, a professional
accountant should not allow bias, conflict of interest or undue influence of
others.
Objectivity, a professional
accountant should not allow bias, conflict of interest or undue influence of
others.
3.
Professional Competence and Due Care,
a professional accountant has a continuing duty to maintain professional
knowledge and skill at the level required to ensure that a client or employer
receives competent professional services based on current development in
practice, legislation and techniques.
Professional Competence and Due Care,
a professional accountant has a continuing duty to maintain professional
knowledge and skill at the level required to ensure that a client or employer
receives competent professional services based on current development in
practice, legislation and techniques.
4.
Confidentiality, a professional
accountant should respect the confidentiality of information acquired as a
result of professional and business relationship and should not disclose any
such information to third parties without proper and specific authority unless
there is a legal or professional right or duty to disclose.
Confidentiality, a professional
accountant should respect the confidentiality of information acquired as a
result of professional and business relationship and should not disclose any
such information to third parties without proper and specific authority unless
there is a legal or professional right or duty to disclose.
5.
Professional Behaviour, a
professional accountant should comply with the relevant laws and regulations
and should avoid any action that discredits the profession.
Professional Behaviour, a
professional accountant should comply with the relevant laws and regulations
and should avoid any action that discredits the profession.
REFERENCES
Financial
Accounting, The Impact on Decision Makers, Gary A. Porter and Curtis L. Norton.
Orlando: The Dryden Press, 1999.
Accounting, The Impact on Decision Makers, Gary A. Porter and Curtis L. Norton.
Orlando: The Dryden Press, 1999.
https://discoveraccounting.org/careers/government/
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