Accounting Overview
April 3rd 2008 21:46
What is Accounting?
Accounting is the foundation of business. Professional and ethical accounting practices build a clear financial picture of a business, allowing managers to make informed decisions, keeping investors abreast of business developments, and facilitating profitable business practices like the flow of funds in a modern economy. Accounting has also been around for thousands of years, making it one of the oldest professions in existence.
In its long history, Accounting has developed into a broad field encompassing a number of disciplines including book keeping and auditing, which are traditional accounting functions. These are functions that are carried out by in-house accountants in a company’s internal finance department, providing management accounting services (custom-made financial reports for internal management) and financial accounting services (producing general purpose financial reports for external users).
Large international accounting firms, such as the Big Four (Deloitte, KPMG, Ernst & Young and PwC), offer diversified services including Taxation, Risk Management, Strategy and Operations Consulting, Forensic Accounting, Corporate Finance and Mergers and Acquisitions (M&A), Insolvency and Corporate Reorganisation. Most employees at these firms hold the Chartered Accountant (CA) qualification, which requires a combination of practical experience and structured coursework, and is an alternative to the Certified Public Accountant (CPA) designation.
Accounting is important because financial records are used to make vital decisions. When the decision concerns a major corporate acquisition – a company is considering acquiring a subsidiary – millions or even billions of dollars may be at stake.
Consequently, good accounting practice is supported by the “Conceptual Framework”, a set of principles that provides practical guidance to accountants. The framework defines important accounting elements such as Assets, Liabilities, Equity, Revenue and Expenses, outlines recognition criteria, and explains qualitative characteristics of accounting information: Relevance, Reliability, Understandability and Comparability. It also forms the basis for the International Accounting Standards (IAS) governing industry practice.
Accounting Careers
Accountants may work in Public Accounting Firms, Government, Corporations or as Sole Practitioners, in one of the following areas:
• Audit - Verifying accounting ledgers and financial.
• Budget analysis – developing and managing an organization’s financial plans.
• Financial Accountant – prepare financial statements based on general ledgers.
• Management Accountant – work internally in companies.
• Tax - prepare corporate and personal income tax statements and formulate tax strategies.
There are currently very strong job prospects for Accountants in most OECD countries.
Accounting is the foundation of business. Professional and ethical accounting practices build a clear financial picture of a business, allowing managers to make informed decisions, keeping investors abreast of business developments, and facilitating profitable business practices like the flow of funds in a modern economy. Accounting has also been around for thousands of years, making it one of the oldest professions in existence.
In its long history, Accounting has developed into a broad field encompassing a number of disciplines including book keeping and auditing, which are traditional accounting functions. These are functions that are carried out by in-house accountants in a company’s internal finance department, providing management accounting services (custom-made financial reports for internal management) and financial accounting services (producing general purpose financial reports for external users).
Large international accounting firms, such as the Big Four (Deloitte, KPMG, Ernst & Young and PwC), offer diversified services including Taxation, Risk Management, Strategy and Operations Consulting, Forensic Accounting, Corporate Finance and Mergers and Acquisitions (M&A), Insolvency and Corporate Reorganisation. Most employees at these firms hold the Chartered Accountant (CA) qualification, which requires a combination of practical experience and structured coursework, and is an alternative to the Certified Public Accountant (CPA) designation.
Accounting is important because financial records are used to make vital decisions. When the decision concerns a major corporate acquisition – a company is considering acquiring a subsidiary – millions or even billions of dollars may be at stake.
Consequently, good accounting practice is supported by the “Conceptual Framework”, a set of principles that provides practical guidance to accountants. The framework defines important accounting elements such as Assets, Liabilities, Equity, Revenue and Expenses, outlines recognition criteria, and explains qualitative characteristics of accounting information: Relevance, Reliability, Understandability and Comparability. It also forms the basis for the International Accounting Standards (IAS) governing industry practice.
Accounting Careers
Accountants may work in Public Accounting Firms, Government, Corporations or as Sole Practitioners, in one of the following areas:
• Audit - Verifying accounting ledgers and financial.
• Budget analysis – developing and managing an organization’s financial plans.
• Financial Accountant – prepare financial statements based on general ledgers.
• Management Accountant – work internally in companies.
• Tax - prepare corporate and personal income tax statements and formulate tax strategies.
There are currently very strong job prospects for Accountants in most OECD countries.
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