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The Role of Accounting to Business and Society

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The Role of Accounting to Business and Society
Justin A. Case
Strayer University
Introduction to Accounting ACC101
Professor Jose Martinez
August 27, 2013

Introduction
In today’s economy Accounting plays a huge role, as it points or refers to accountability and transparency in the business environment and paints a picture of any business. Also, it enables business managers and corporate leaders to make better comprehensive decisions regarding the financial shape of their business. Accounting is fundamentally described as a mathematical discipline in which allow companies to universally record, analyze and retrieve financial information that is critical to them. This information is then used to determine the companies’ financial positions consequently enabling the management team to make sound decisions depending on the information at hand.

The Role of Accounting on Business and Our Society Financial statements are snapshots of a business's economic or cash flow condition. These are mainly formal financial activities, which are written to measure the performance, financial strength and the liquidity of the business. These financial reports include the balance sheet, income or profit and loss statements, and cash flow statement which are used to represent the businesses’ economic position. The income statement which reports the company’s financial status in terms of profits or losses made during a given period. It comprises of income and expenses, from which the profit or loss is determined and the cash flow statement recaps the business cash payments related to its operating situation and financing activities. (Inc., 1999)
The major function of accountants is to fundamentally manage and understand financial data from its raw form and it is their responsibility to collect, understand and preserve a company’s economic data. However, the main function…...

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