According to Webster’s dictionary, accounting is “the system of recording and summarizing business and financial transactions and analyzing, verifying, and reporting the results.” (Merriam-Webster, n.d.) Accounting impacts society in many ways including the use of free markets to set resource priorities, providing information, nonbusiness resource usage, providing careers and communicating business results (Edmonds, McNair, Olds, & Tsay, 2012). Society needs the accounting profession to be able to gauge success, or lack thereof, in dealings in the business world. In order for society to function it requires raw materials, the people or entities with the resources to change those resources into products and the people who buy the finished products. We as consumers buy products that are created by businesses for our use and in exchange for those products we provide monetary rewards. The business that produce the products use those monetary rewards to keep their business running and the accountants that work for those businesses help them determine how much money they need to make to not only keep their business running, but also to make a profit. Each company in existence has stakeholders, which are the different people who have an interest in the accounting information. Externally this can include financial analysts, government regulators, attorneys, etc. Internally this can include employees, managers, and investors. The stakeholders use the accounting information and interpret it to determine the company’s potential for profits and success, so the company depends on these stakeholders (Edmonds, McNair, Olds, & Tsay, 2012). There are some companies that exist to aid humanity and not to make a profit. Although these... ... middle of paper ... ... p. 374). Managerial accounting, like most things in business, is forever evolving. In order for a company to stay competitive they need to keep up with the new trends in their industry. These new trends include, but are not limited to, total quality management, activity based management and value added assessment. (Edmonds, McNair, Olds, & Tsay, 2012, p. 376) Total quality management is based on focusing not only on the profits of a company but on how to ensure their longevity but also focusing on their value add qualities such as customer service, efficiency, innovation and quality. Activity-based management and value-added assessment both focus on making the most out of the value chain and getting rid of any activities that are a part of the chain that do not add some type of value to the company’s processes or products (Edmonds, McNair, Olds, & Tsay, 2012).
Accounting is “a systematic process of identifying, recording, measuring, classifying, verifying, summarizing, interpreting and communicating financial information” (Accounting, n.d.). Financial information mentioned above includes any financial transactions done by the business. There are two types of accounting. The first one is accrual accounting, which realizes transactions at the time they occur and disregards whether or not cash transaction has occurred. This method is widely used in business, because it allows transactions to be completed over time and distance. Financial statements produced by accrual accounting reflect a sophisticated trade and a much more accurate snapshot of the business’ current situation. The opposite of accrual accounting is cash accounting, in which transactions are realized only when cash payment is made or received. This is the method used in personal finance.
Accountants are professionals whose expertise and knowledge the clients that hire them count on. Because of this expertise, the reports and financial statements that an accountant produces for his clients are considered a fair and accurate reporting of their clients' financial situation.
According to Marshall, McManus and Viele (2004), accounting is “the process of identification, measurement, communication of information about a business for the purpose of making decisions and informed judgment” (p.3). Decision makers look at balance sheets, income statements, changes in the owner’s equity and cash flow statement as documentation of the viability of an entity. Misrepresentation of the financial statements can place doubt of profitability in any company. The need for accountability and regulation of accounting practices is important in preserving trust in the business community.
During my college years, the hardest choice I had to make was deciding on a major and choosing a career path. When I came to OCC I knew I loved business but I was also curious about accounting. I found that the business degree with a concentration in accounting was the program for me. It’s the one degree that gives me the strong foundation to get me into the business world and having the accounting minor gives me the tools I need to succeed. The reason accounting may be one of the best degrees to a successful business career is because accounting has always been considered as the language of business. Accounting is defined as the information system that measures business activities, processes information into reports, and communicates the results
Financial and Managerial accounting are used for making sound financial decisions about an organization. They provide information of past quantitative financial activities and are useful in making future economic decisions. (Albrecht, Stice, Stice, & Skousen, 2002) The same financial data is used to derive reports for each accounting process yet they differ in some ways. Financial accounting primarily provides external reports for external users such as stock holders, creditors, regulating authority and others. (Garrison, Noreen, & Brewer, 2010) On the other hand Managerial accounting is concern with providing information that deals with the internal viability of the organization and is tailored to meet the needs of an individual organization. (Albrecht, Stice, Stice, & Skousen, 2002)
Article 1 The Brain and Soul of Capitalism Nancy Koehn, author of “The Brain and Soul of Capitalism”, advocates that companies cannot hope to sustain themselves while ignoring external responsibilities. According to the Harvard Business Review article, it is imperative that capitalism has a brain and soul in order to tackle the dynamic and complex issues plaguing the business environment and society as a whole today. The International Organization for Standardization endorses these ideals by claiming social responsibility is ‘a critical factor in [a company's] ability to… operate effectively [in addition to a gauge of] overall performance’ (Investopedia, 2015). The company’s aim should target more than simply maximizing profits.
The conceptual framework identifies the primary users of accounting information as investors, creditors, and those who advise them. It also assumes a “prudent” investor; that is, an investor who takes the time to become reasonably well informed with respect to accounting theory and practice. Discuss this concept with respect to the current economic environment. Are different groups of investors “prudent”? According to the conceptual framework, the potential users of financial statements are investors, creditors, suppliers, employees, customers, governments and agencies, and the general public (Financial Accounting Standards Board, 2006).
The study of history is defined as the narration, documentation and analysis of events that occur in the past, and for many years history has influenced several structural models and customs within the present-day society. Accounting history is, the narration and interpretation of historical events that have impacted the accounting profession. This essay seeks to investigate the impact of history on accounting and the relevance of accounting history, to addresses and answer the question of the importance of history in the accounting profession.
Ethics is derived from the greek word ‘ethos’, which means character and the latin word ‘moras’, which means customs. Thus ethics is defined as the personal and professional behaviour with regards to the values, customs, behaviour, principles and morals of society (Senarante, 2011). Professional ethics can be defined as the personal and corporate standards of conduct that is carried out by members of a particular profession. For example, medicine, accounting and engineering. Professional ethics or business ethics cover larger areas than the law, and although an issue may not be illegal, it can be considered as an ethical issue (ATT Ethics, 2013). Business ethics can be defined as the policies and principles that act as operational guidelines
Carroll (1979) states, “business encompasses the economic, legal, ethical and discretionary expectations that society has of organization at a given point in time”.
Accounting has been a living part of history since the Neolithic period and remains a prevalent and ever-evolving profession still to this day. This essay therefore proposes to look at the significance and role of history specifically related to the accountancy field. In order to substantiate this claim of the importance of accounting history, numerous benefits of accounting history will be presented. Factors such as the use of historical research and its availability thereof to constantly develop accounting policies will be discussed as well as how historical accounting practices can be used to understand current practice and assist in the training of individuals in the accounting field. Lastly, the importance of history in the development
At a glance, accounting might appear as a repetitive cycle of preparing and examining financial statements. However, a brief exposure to accounting has taught me how chaotic it can be for accountants. An accountant captures and represents the information of businesses. By reviewing financial operations, an accountant helps a business run efficiently. This profession can be intellectually stimulating and rewarding. After learning about accounting, I cannot help but be interested and desire to work toward a degree in accountancy. In my studies, I have learned accountants require a plethora of qualities to be successful. And to mature from a student to a professional, I must resolve to strengthen my weaknesses. There is much I must learn and achieve, but a degree in accounting is well worth the time spent.
An accountant makes sure that the Nation’s firms are run efficiently, the public records are kept accurately, and that taxes are paid properly and on time (“Accountants and Auditors”). Accounting is the study of how a business tracks their income, assets, expenses, and many other things for a period of time. They also do many other things like quality management, tax strategy, and health care benefits management (“Welcome to Careers in Accounting”). An accountant is crucial to the success of a business, without one the business tends to fail.
The current social and business environments, sophisticated information systems development, and structural changes and innovations induced companies to implement profound changes in their management instruments, their business-management models, and their methods of managerial accounting (Guerreiro et al, 2006). Literature in this field (Ribeiro & Scapens, 2006; Jarvenpaa, 2007; Byrne & Pierce, 2007; Jarvenpaa, 2009) has pointed out the changing role of managerial accounting roles, from being a scorekeeper to being a business analyst and an active advisor of management in the decision making process. In their point of view managerial accounting has become more business oriented, involving relevant accounting systems, personal and organizational desire, personal competencies, and overall business knowledge. Moreover, new managerial accounting techniques such as strategic cost management, activity based costing, customer profitability analysis, balanced scorecard, target costing, modern financial and operational control systems and software packages enhanced the business orientation of managerial accounting (Cardos & Cardos,
Accounting is so important in our modern society. It serves a variety range of place in our society. It serves a variety range of place in our soceity, from school to hospital, from business firm to government agencies. It's also the main force in regulation of taxation and industrial activity. It serves a great aspects on the development of mass-production systems, any way, it's a very important term in our modern soceity.