The Vitality of Keeping Accurate Accounting Records for a Business
Question One:
The two main reasons why it is vital for a business to keep accurate
accounting records is 1. For legal reasons to do with acts enforced by
parliament and 2. To record the performance of the business.
Every year companies are by law required to produce a set of
accounting records that show a true and fair view of its financial
position. Copies of these records then have to be filed with the
Registrar of Companies at Companies' House and sent to every
shareholder and debenture holder. The Companies Act 1985 states the
minimum amount of information that has to be included, although many
companies see it as a public relations opportunity and produce
information on staff, products and other areas of the business. This
is done in an attempt to make other parties such as shareholders aware
of the company and of future developments. No matter the size of a
business they must all comply with the legal requirements of the
Companies' Act 1989.
From a practical point of view, if a company did not make any records
of transactions carried out, it would prove to be impossible for them
to evaluate the performance of the business or even compare it with
another companies' performance. Good record keeping can show whether
the business is improving, which items are selling and what changes
are needed. By producing a profit and loss account and a balance sheet
they can distinguish exactly where they have incurred expenses and
what on e.g. Staff wages and electricity payments, and where money has
been made e.g. profits from sales. The underlying need for these
...
... middle of paper ...
...on acquired on performance measurement.
Ø Name: Accounting and Finance
Author: Humphrey Shaw
Attained information on concepts and conventions, taxation and
Company Acts.
Ø Interviewed a Mr Graham, practising chartered accountant in Gerards
Cross. Gathered information for questions one and two.
Ø Interviewed a Mr C.Ward, owner of a medium sized agricultural firm.
Acquired information on VAT an corporate tax.
Ø Internet: Progress Interventions -
http://www.pinterventions.org/good_record_keeping.htm
Information acquired on the importance of keeping accounting records.
Ø Internet: Financial Accounting Standards Board -
http://www.fasb.org/
Information on accounting rules and regulations.
Ø Internet: Official Inland Revenue website - www.inlandrevenue.gov.uk
Information on Taxation.
Management accounting in organisation is very important for decision-making and to make the business more efficient and therefore increasing its profits. Is the process of preparing accounts that can help managers to make day-to-day and short-term decisions, by providing them with accurate and timely key financial and statistical information...
Additionally, today’s society is filled with legal and ethical concerns that surround numerous individuals and their responsibility is to keep all information private and accurate. Furthermore, accounting and financial reporting is the most significant function of a business and entails a great sense of legal, ethical and technological concern.
Michele will know when accountability is presence because she will see it on the floor. She will see the nurses practicing taking EBP and applying to their care. In a similar manner, Michele will also see accountability when they come to the follow-up quality improvement meetings and contribute on how the changes are going. In addition, depending on what EBP the unit decided to institutes Michele will be able to see data that backs up the nurses have been accountable.
T.A., L. 1996. Richard Brown, Chartered accountant and Christian gentleman. In: Lee, T. eds. 1996. Shaping the Accountancy Profession: The Story of Three Scottish Pioneers. New York, Garland: pp. 153-221.
The nature of business has changed and evaluation. ‘New techniques have been developed and existing one has adapted to try to ensure that management accounting retains its relevance’ (Atrill, P. el at 2013, pg. 12). Then, what is management accounting? ‘The application of professional skills in the preparation and presentation of accounting information in such a way as to assist management in the formulation of policies and in the planning and control of the operations of the undertaking’ (Tyagi, C. el at 2003, pg.12). The management accounting is very significant thing in the operation which this might consider as tools that allows administrators to manage their enterprise, make internal stakeholder understand more and cooperate
There are a few options if one is looking at going into the profession of accounting. A large portion of what career a person would like to go into will be based on what field they are interested or if they have a specific industry they would like to focus on. For anyone looking to go into accounting there are many different careers and each is unique in their own way, with a difference in schooling or certifications being a deciding factor for the person.
Shareholders are interested in dividends and profits. As they invest their own money in to the business they are really interested in how the business is running and how well it is doing. They are the owners of the business and they need to get information from those that manage the business on their behalf. They don’t have access to the same amount of detailed information as the managers do. The financial reports that are given to the shareholders are also used by other users such as lenders and trade creditors. These reports are regarded as general reports. (Elliot B and Elliot J, 2011, p.4)
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)
Accounting Theory: Conceptual Issues in a Political and Economic Environment (6th edition ed.). South Western College Pub.
Another benefit of accounting history is that it assists one in better understanding current accepted practice or issues. The background knowledge that one attains allows individuals to understand its purpose and how they should act to be in accordance with these aims. Two examples of recent accountancy norms include that of extensive auditing procedures and external disclosure of financial statements. (auditing, external
The purpose of this document is to describe the nature, purpose and scope of accounting and it deliberately explains the details of each category in accounting. Accounting involves in preparing financial documents of an entity by analyzing, verifying, and reporting this records. It emphasizes its major characteristic role in field of banking and finance, with a mixture of supportive sub topics.
There are different understandings of financial reporting. In general terms, we can equate it to reporting of “external accounting”; which indicates an accounting that disseminates through internal business management to owner or broader stakeholder. From mainstream economist point of view, financial accounting can also be described as information that guides economic decisions. For information specifically in financial accounting, the approaching of perfect information is often taken as desired. More transparent information often leads to improved economic decisions. However, more transparent information means the more cost associated with providing the information.
Simon (1978) conducted a study about the role managerial accounting. In his opinion managers have three major expectations regarding to management accounting roles: scorekeeping (capturing,
Accounting is a very important term to our modern society. It is the career for men and women who at the start have their eyes set on top positions in industry, management, government, and general business. Accounting is a basic need of every businessman, from the operator of a filling station to the government of the United States. It's so important to our society. None of the business organization can operate without is. They are there-somewhere-in every business. In small business, people use pen, ink and skill keep the records. In large business, modern accounting machines are used to operate. Men and women are directing these machines in the accounting process. Wise businessmen enter business must have some accounting knowledge.
The following essay aims to analyse in depth a computerised accounting system and its aspects such as its history, what technologies is based on, and how it has developed since its beginning. Other aspects such as the current state of the system and the interactions with other systems and the future of the system will also be covered in this paper.