Accounting can be defined in many ways. Some people say Accountancy (British English) or accounting (American English) is the process of maintaining, auditing, and processing financial information for business purposes. Wikipedia says Accountancy is the art of communicating financial information about a business entity to users such as shareholders and managers. The communication is generally in the financial´s form statements that show in money terms the economic resources under the control of management; the art it self lies in selecting the information that is relevant to the user and is reliable.
Statement of the Accounting Principles Board No. 4 defines, “Accounting is a service activity. Its function is to provide quantitative information, primarily financial in nature, about economic entities that is intended to be useful in making economic decisions—in making reasoned choices among alternative courses of action.”
According to the Committee on Terminology of American Institute of Certified Public Accountants (AICPA), “Accounting is the art of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events which are in part at least, of a financial character, and interpreting the results thereof”.
The American Accounting Association defines accounting as "the process of identifying, measuring and communicating economic information to permit informed judgements and decisions by users of the information!”
Accounting is the process of financial reporting of an economic or a business entity using generally accepted standards or principles with the objective is to provide information about the financial position, performance and changes in financial position of an entity that is useful to a wide range of users in making economic decisions.
No comments:
Post a Comment