Accounting is a branch of science that deals with the recording of financial transactions. A lot of emphasis is given to the measurement of the values extracted from these transactions for analysis purposes. Generally, most accounting records are used to track current financial activities and trends.
The basic premise on which accounting stands is, “Accountants are people who examine financial records in order to make sure that the financial statements reported to investors, regulators, or management are correct, complete, and up-to-date.” In other words, accounting performs a vital role in society. It is the main means by which businesses and governments to come up with accurate public reports about their activities. There are many different kinds of accountancy, each dealing with different aspects of the financial record-keeping processes.
Bookkeeping is the process of keeping track of all financial transactions made in a certain company. Financial accounting methods may include journals, ledgers, and scales, which will be employed in recording the financial transactions. Most accounting software programs can easily handle the recording and analysis of data related to business. To be more specific, accounting involves the collection, interpretation, preparation, management, use, and reporting of information relating to the financial activities of a company.
Businesses typically have their own accounting department. For smaller enterprises, the head accountant generally handles this task. However, large companies usually hire an accounting firm to handle the entire accounting process. The work of the accounting firm consists of gathering information from various parts of the business, analyzing the data, preparing reports, and making recommendations regarding the accounting of the company. Some of the most important responsibilities of these firms include:
Today, a booming industry in the field of accounting is forensic accounting. This has emerged as a career option due to the high need of accounting personnel for witness statements in court cases. Accountants, particularly senior accountants, often play a crucial role in finding a suspect within a short period of time after an accident or crime has been committed. Forensic accountants use numerous methods to determine the guilt of a person involved in a crime or an accident.
Nowadays, more people are turning to the use of accounting software because of its increased reliability and ability to store and analyze large amounts of data quickly and efficiently. Accounting software programs are designed to simplify the complex process of accounting by removing the need for complicated spreadsheets. In fact, a majority of business establishments today are using some form of accounting software. The popularity of this software can be attributed to its ability to effortlessly manage inventory, financial, and payroll while reducing paperwork, and eliminating the errors that come with manual record keeping.