Overview of the Accounting Environment, Profession, and Its Accounting Elements
Definition of Accounting
Accounting - is the art of recording, classifying, and summarizing financial transactions and
events in monetary terms, and interpreting the results.
Nature of Accounting
•Often seen as a science with fixed rules, but it is more an art than a science.
•Uses estimation and professional judgment.
•Guided by generally accepted accounting principles, standards, and practices.
Functions of Accounting
•Provides relevant and timely information for decision-makers.
•Assists management in planning, controlling, and allocating resources.
•Known as the language of business.
•Helps identify inefficiencies, problems, and possible solutions by showing costs and benefits.
Purpose of Accounting
• To record the financial history of a business.
•To provide owners with reliable information about financial condition and operations.
•Helps determine whether profit objectives are achieved.
Branches of Accounting
-Financial Accounting
-Cost Accounting
-Managerial Accounting
-Government Accounting
-Taxation Accounting
-Auditing and Assurance Services
Definition of Accounting
Accounting - is the art of recording, classifying, and summarizing financial transactions and
events in monetary terms, and interpreting the results.
Nature of Accounting
•Often seen as a science with fixed rules, but it is more an art than a science.
•Uses estimation and professional judgment.
•Guided by generally accepted accounting principles, standards, and practices.
Functions of Accounting
•Provides relevant and timely information for decision-makers.
•Assists management in planning, controlling, and allocating resources.
•Known as the language of business.
•Helps identify inefficiencies, problems, and possible solutions by showing costs and benefits.
Purpose of Accounting
• To record the financial history of a business.
•To provide owners with reliable information about financial condition and operations.
•Helps determine whether profit objectives are achieved.
Branches of Accounting
-Financial Accounting
-Cost Accounting
-Managerial Accounting
-Government Accounting
-Taxation Accounting
-Auditing and Assurance Services
