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Accounting is the systematic way of recording, measuring, classifying, summarizing, interpreting and communicating financial information. It is known as the “language of business” as it analyses and conveys the result of an organization’s economic activities to investors, management, regulators and creditors.Accounting plays an important role and is a key function to each and every business; it may be managed by a bookkeeper and accountant at small firms or companies or by a financial department in larger companies with dozens of employees. Advanced accounting is handled by qualified accountants. There are many types of accounting given by Accounting Essay Writing Help- financial accounting, management accounting, tax accounting, external auditing, and cost accounting, governmental accounting and project accounting.
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The objective of accounting is given in Accounting Essay Writing Help: –
• To maintain systematic records of business transactions.
• To find profit or loss of a company.
• To represent financial position of a company.
• To provide information to interested parties.
Accounting and its types
Accounting is of thousand of years old and can be marked to ancient civilization. The word accountant is derived from the French word ‘computer’ which is derived from the Latin and Italian word computer. The different sub fields explained by Accounting Essay Writing Help are: –
- Financial accounting:
– Financial Accounting is also known as financial reporting. It is the type of accounting in which information is produced in the form of financial statements for external use. These financial statements consist of an individual or entity’s past performance and current position which are based on GAAP (Generally Accepted Accounting Principles). GAAP is a set of guidelines for financial accounting used in given jurisdiction.
- Management Accounting: –
It is a type of accounting in which information is produced for internal use by the firm’s management. This information is more detailed and efficient than that produced for external use. It helps managers to take decision and fulfil the objective or aim of their company. The reports or forms produced in this process are upon management’s decision.
- Tax Accounting: –
It is the type of accounting which is related to tax. It is governed by the tax rules given by the tax laws of a jurisdiction and is different from GAAP. Tax accountants manage the financial statements which are prepared under financial accounting principles; and then this information is used by tax professionals to estimate tax liability of a firm.
- Governmental Accounting: –
It is also known as Public accounting or Federal accounting. It is the type of accounting which is used in the public sector. This is slightly different from financial accounting system. The separate accounting system is due the different aims and objective of the government and private institutions.
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