...The Role of Accounting in Business and Society According to Merriam-Webster the full definition of accounting is the system of recording and summarizing business and financial transactions and analyzing, verifying, and reporting the results. An accountant is one who is skilled in the practice of accounting or who is in charge of public or private accounts. (http://www.merriam-webster.com, n.d.) Someone who has obtained a bachelor’s degree in accounting can pursue many different accounting career fields. According to the Bureau of Labor Statistics the median annual wage for accountants and auditors was $63,550 in May 2012. Employment of accountants and auditors is projected to grow 13 percent from 2012 to 2022, about as fast as the average for all occupations. (Bureau of Labor Statistics, n.d.) Many start out in entry level accounting positions or they may take the Uniform Certified Public Accountant Examination administered by the NASBA (National Association of State Boards of Accountancy) to become a Certified Public Accountant. CPA’s must also complete certifications and educational requirements as required by their individual states. A CPA is capable of handling many job functions in accounting from auditing and reporting to tax preparations for corporations and individuals. A CPA also assists clients with other financial functions, including asset management, risk assessment, and internal reviews. A CPA may also choose to work for himself as a public accountant or by...
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...The Role of Accounting on Business and Our Society Stephanie R. Phillips Professor Cedano Accounting 100 February 27, 2014 When most people think of accounting, they think taxes, but accounting is so much more than that. Accountants are responsible for maintaining the financial health of our businesses. They also practice with an ethical standard that protects the public from unfair and one sided business and government practices. So next time you take your box of unsorted receipts to your tax preparer be sure to thank them for what they do the rest of the year. The four financial statements in the accounting process are an income statement; owner’s equity statement; balance sheet; and statement of cash flow (Weygandt, Kimmel, & Keiso, 2013, p. 21). Each of these statements is vital to internal and external users in order to provide relevant financial data. An income statement lists revenues and expenses that result in the net loss or income of a company during a given time frame, usually at the end of the month and the end of an accounting cycle. The owner’s equity statement accounts for any change in equity, it also records all investments and drawings made by the owner. The balance sheet shows a company’s assets, liabilities, and owner’s equity. In essence, the balance sheet shows what a company has and what a company owes. The statement of cash flow accounts for any cash in, out, or invested during the designated time period. The statement of cash flow must account...
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...Assignment 1: The Role of Accounting on Business and Our Society Professor ACC 100 – Accounting The Role of Accounting on Business and our Society Accounting is an essential part of modern business. From the smallest start-up to the largest fortune 500 hundred company, accounting is how business growth, contraction, or direction is determined. When entering the accounting world you will be required to deal with the four financial statements, the balance sheet, the income statement, the statement of cash flows, and the owner’s equity statement. The purpose of the balance sheet is to reveal the economic/financial position of the company at a set point in time. The balance sheet follows the basic accounting equation, assets = liabilities + owner’s equity. The income statement is what an accountant uses to determine the operation of a business. You would take the revenues minus the expenses to determine the net income for the business. The statement of cash flow is useful in determining a business’s capability to pay its bills. It represents a breakdown of all transactions, and show how the company acquired its cash and what it is doing with it. Lastly there is the statement of owner’s equity. This statement shows the variations in retained earnings. While all of the financial statements are needed the most important would have to be the cash flows statement. Cash flows is most important because it provides you with the information needed to see if a company...
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...The Role of Accounting on Business and Our Society Angel Ramos Professor Darlene Green-Connor ACC 100: Accounting I March 2, 2014 The Role of Accounting on Business and Our Society There are many decisions that companies make every day in order to be in business as well as to ensure it continues to stay in business. If in retail, such examples would be to extend its inventory or cut back on an item, place certain product on sale or on clearance, or even if it would be better to relocate or sell the company. Before making any of these decisions, management and the decision makers need to know how the company is doing. There are valuable key point indicators that can help in the ultimate direction but no other report is more commonly used than the financial statement. The financial statement of a company tells the story of where the company stands in regards to their financial position, business strategy and future earnings. “As businesses have expanded internationally, so has the need for consistency and comparability in the financial reporting of events and transactions in the financial statements” (Ward, p.78). They are commonly standardized in a format that can be viewed and translated by financial and non-financial people alike. The four major components are the Income Statement, the Owner’s Equity Statement, the Balance Sheet and the Statement of Cash Flows. Financial Statements Income Statement The Income Statement is gathered within a specific time period...
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...balance sheet shows the big picture of a company’s Assets, Liabilities and any Owner’s equity that the company has at that particular time. Statement of cash flow – The purpose of the statement of cash flow is, so a business owner is aware of any financial events that could have a reverse effect on the company’s ability to meet their obligations. A balance sheet is most effective in communicating the financial health of an organization because it shows the financial transactions of a company front one point to another. Questions: 2 A public accountants duties include preparing and verifying important financial documents, analyzing budgets and planning finances as well as bookkeeping, and auditing tasks. Public accountants can give advice and provide basic financial information from clients to corporations. Certified public accountants can do the same things that public accountant due as well as overseeing budget and financial management, create and analyze budgets, and advise management on tax ramifications of business decisions. Accounting is an important part of any business. It records the way a business grows, and makes any suggestions on how to improve. Accounting has become one of the fastest growing careers because it expands even more each time a new business starts up. In today’s...
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...Assignment #1- The Role of Accounting on Business and Our Society ACC 100 March 2, 2014 Financial Statements There are three financial statements that are used in the accounting process; Income statement, Statement of Owners Equity and Balance Sheet. The purpose of the income statement is to report a firm’s earnings over a period of time which is usually their previous fiscal year. Statement of owners’ equity reports the changes of the company’s transactions for a particular time period, all changes and edits can be reviewed in a detailed view. The balance sheet list the three major accounting equation within a detailed time period; assets, liabilities and owner’s equity. The most effective way to communicate the financial stability of a company is through the balance sheet summary. The balance sheet allows the company to keep a steady track of their spending and what is outstanding on their books; this can eliminate financial surprises and allows the company to make preparations to recover in a positive way. Major Functions of an Accountant and Certified Public Accountant An accountant and certified public accountant plays a vital role to a company’s financial success, their main duty is to monitor and keep track of the company’s financial records. The role of an accountant is slightly different than a certified public accountant, an accountant for a corporation will manage the finances, purchasing and business transactions with outside firms. They are the financial...
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...The Role Of Accounting On Business And Our Society Skyya Charles Strayer University ACC100 Ekaterina Kouprianova The Role of Accounting on Business and Our Society Accounting is considered to be a very vital career in the society because it deals with various fundamental positions in organizations and institutions such as management, financial recording, budgeting and control and also in business innovations. It is what every for-profit and non-profit organizations need because it deals with recording the progress of the organizations or institutions, analyzing figures and more importantly determining the future of a firm. This is achieved through analyzing and scrutinizing the current financial records and the previous years’ financial records. Accounting integrates various financial statements such as income statement, balance sheet and also the statement of owners’ equity (Lasser Tax Institute, 2010). This implies that there are various careers that are linked to accounting, and these are with inclusion of accounting clerk, accounting assistants, budget analyst, accounts payable clerk and chief financial officer (CFO). It also has careers such as staff accountant, Certified Internal Auditor and forensic accountants. Career Options Chief Financial Officer (CFO) Chief Financial Officer (CFO) is very important personnel in determination of the overall success of an organization. The officer is obliged to offering...
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...Research Journal of Finance and Accounting ISSN 2222-1697 (Paper) ISSN 2222-2847 (Online) Vol.5, No.4, 2014 www.iiste.org Development of Accounting Theory Based on Islamic Teachings: A Glance over Principle of Al-Adl and Al-Ihsan Shaukat Amer1* Sofri Bin Yahya2 1- COMSATS Institute of Information Technology, Kamra Road, Attock, Pakistan. 2- Dean, Graduate School of Business, Universiti Sains Malaysia, Malaysia *E-mail of the corresponding author: shaukat_amer@comsats.edu.pk Abstract The beauty of accounting based on Islamic principles is that it not only deals with the valuation but also deals with an inbuilt accountability mechanism. Generally the accounting should be able to perform roles like keeping safe custody of interests, certifying true and fair view of business, enabling accountability and providing reliable information for successful decision making to all the stakeholders. In this context there are three main issues with respect to present system of setting accounting standards. These are undue pressures of certain groups in setting these standards, no role of owners in setting these standards, and flexibility/discretion in applying these standards which may lead to subjectivity. These may results in incorrect valuation of business transactions, increasing management discretion which in return will increase corporate governance issues including incorrect financial reporting, earning management and limiting decision making ability of the stakeholders. In order to...
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...The Role of Accounting on Business and Our Society Adrian Smith Accounting 100 Prof. Eric Osei A Financial statement is a record of financial activities of a business entity. Main objective of financial statements is to provide information about financial position, performance and changes in financial position, and flows of cash in the business organization which in turn is essential in making decisions. In order for financial statements to provide the necessary information, they have to abide by the principles of understandability, relevance, reliability and comparability (Alexander et al, 2005). The first financial statement under consideration is statement of financial position. It is used to report on assets, liabilities, and capital of an entity. Assets are resources which have economic value attached to them, for example cash, debtors and inventory. Liabilities on the other side include creditors, deferred tax and accruals. Finally, capital is the owner’s equity. Statement of financial position is used to ensure that assets balance with combination of liabilities and capital. Second is the statement of comprehensive income. It provides information on revenues, expenses and profits incurred in a particular period of time. Its major purpose is to help in determining whether the business entity is operating at a profit or loss in a particular trading period. It also serves to reveal the rate of earning per share that is the amount of to be given to each stakeholder. Statement...
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...Critical Perspectives on Accounting- MMPA 516 Journal This Journal provided me an opportunity to express my views and critically analyze the different aspects to which accounting relates. It had been a great experience and a great approach to express ones opinion. 2014 Harleen Kaur Juneja 300289064 6/3/2014 Critical Perspectives on Accounting- MMPA 516 Journal This Journal provided me an opportunity to express my views and critically analyze the different aspects to which accounting relates. It had been a great experience and a great approach to express ones opinion. 2014 Harleen Kaur Juneja 300289064 6/3/2014 TABLE OF CONTENTS 1. INTRODUCTION Page 2 2. ACCOUNTING IN ITS WIDER SENSE Page 3 3. ACCOUNTING AND EDUCATION Page 4 4. ACCOUNTING AND WAR Page 8 5. ACCOUNTING AND GLOBAL FINANCIAL CRISIS Page 11 6. ACCOUNTING AND CSR Page 13 7. REFERENCES Page 15 INTRODUCTION In this course I was surprised to see the other face of accounting. Till date I use to see the stereotypical accounting course that teaches us on a pattern to make us number crunchers who can arrange, categorize, and report details in a manner so unreasoned that only other accounting student can understand them. I had not seen to possess the more important reasoning skills that are necessary for the real life problem solving and business leadership, except to my exception in the MMPA 511 course taught by Arun Elias...
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...Accounting and its role in society Accounting is concerned with collecting, analysing and communicating economic information (Atrill & McLaney, 2004, p1). However in order to develop a broader understanding of accounting and the central role it plays in society, we need to consider it from a social perspective. Individuals in society coexist by establishing relationships with each other. Another way of viewing society is by segmenting it into different groups or arenas, for example the social, economic, organizational and political arenas (Kyriacou, 2007, Lecture 1, p4). In order to function effectively, these different arenas need to communicate and it is accounting information that facilitates this communication. According to Kyriacou (2007, Lecture 1, p5) accounting information serves many important purposes, for example assisting users in making informed decisions, in relation to the effective allocation of scarce resources. Therefore accounting information can be seen to be a potent influence in society, which affects everybody. This is illustrated by the National Coal Board case (Cooper et al, 1985, p10) were the measurement of accounting profit was used to justify the closure of coal pits, causing an impact on electricity prices, jobs and taxes. Accounting has a long history and as demonstrated by Hines (1988, p251-261) it is seen as being socially constructed i.e. it is practised by people for people and therefore it is more of an art rather than a science. Unlike...
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...RELEVANCE OF MY ACADEMIC QUALIFICATION TO THE ECONOMY Introduction Accountancy is the foundation of accountability in public and corporate governance. Accounting entails capturing financial activities, summarize and interpret them for its various users, because financial information is necessary for informed decision to the management, employees, regulatory bodies, potential investors and other stakeholders. Accordingly, accounting is often referred to as the language and soul of business for the fact that it produces and keeps pertinent financial information of business entities. The profession strives to protect its core values of integrity, competence and objectivity which remains the time tested building blocks for what has been a truly successful and honoured profession. For the study of accountancy in Africa, Nigeria is important for several reasons. Nigeria, the most populous country in Africa, has crude oil as her main export and she has remained a rentier state in terms of revenue generation. The need for legal regulations for exercising accounting profession came to reality on September 1, 1965 by the enactment of the Institute of Chartered Accountants of Nigeria Act (ICAN). Some decades later the Association of National Accountants of Nigeria was established by law. For the accountants to truly play a leadership role in their field, they must be proactive participants in the development process. Nigeria became independent in 1960 at the crest of a global wave of decolonization...
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...Definition of 'Accounting Information System - AIS'The collection, storage and processing of financial and accounting data that is used by decision makers. An accounting information system is generally a computer-based method for tracking accounting activity in conjunction with information technology resources. The resulting statistical reports can be used internally by management or externally by other interested parties including investors, creditors and tax authorities. | Answer:There are various importance of accounting information to a business entity. Getting to know what an accounting information is and the importance (need) of it is a great step to improving one's capital base, both from the finance aspect to the resources (raw materials) an organisation uses in carrying out its objectives. An accounting information is simply the data which an organisation/business entity is able to make known to its users. It should be taken note that these users of accounting are of various sections - to which a business entity is one of. A business entity will require an accounting information so as to enable it manage and control its finances and resources. It also needs it for it to be able to improve on its level of profit earning, should it realises it is declining in its profitability level. It also needs to for it know the differences between its marginal liability and its marginal assets. There are so many importance of a business information to a business enterprise, but the...
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...Journal of Business Cases and Applications The state of accounting in Egypt: a case Khaled Dahawy The American University in Cairo Nermeen F. Shehata Cairo University Tad Ransopher Georgia State University Abstract Egypt, one of the largest Middle East economies, is beginning its transition to a market economy. As a developing nation, Egypt has witnessed several changes in its accounting system during last two decades. This case provides an analysis of the Egyptian accounting system with emphasis on the development of the Egyptian Accounting Standards. In addition, this case makes recommendations for the reformation of the Egyptian accounting system. Keywords: Egypt, International accounting standards, Egyptian accounting standards, Egyptian accounting system, Privatization, Culture The state of accounting, Page 1 Journal of Business Cases and Applications 1. INTRODUCTION The purpose of this case is twofold. The first goal is to present an analysis of the development of the Egyptian accounting system. The second goal is to provide several recommendations to facilitate the Egyptian accounting reformation. Once accounting reformation occurs, Egyptian companies can prepare financial reports that will be of greater benefit than those at present. To Egyptian companies the result will be an increase in foreign investment and funds raised from external sources. With these goals as the objective, Egyptians need to comprehend successful accounting systems...
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...D | 5 | Bibliography | 6 | Financial Accounting 1 Group Assignment Question A As what we understand for the words of Professional Accountant is who has experience and skills in establishing and maintaining accurate financial records for a business. Accountants’ works including control the system of record, auditing books and prepare a financial statement (Hossain, 2013). The accounting profession in Malaysia is controlled by the Malaysian Institute of Accountants (MIA) through the powers discussed by the Accountants Act, 1967. In Malaysia, we needed some certificates to show that we are accounting educated so that we are having the abilities to work as certain company’s accountant. Those certificates are known as ACCA, LCCA, CIMA and also MICPA. Start from few years back, Malaysia standard of requiring accountants was raised from LCCA to ACCA. With ACCA certificate, a person can consider as a professional accountant and so he or her has the ability to finish the duties. Question B In an organization, accountant plays a very important role. Without an accountant, the organization cannot work effectively (role of accountant, 2013). Accounting is a special division of knowledge. Both the accounting system and the accountant provide a very useful service to the society. There are a lot of stuff can be done by an accountant. Firstly, an accountant does bookkeeping. They keep a systematic record of the transaction in the business to ensure the organization operation. Accountant...
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