Accounting

Accounting

1. DEFINITION

   • Process of recording a concise summary of financial transactions pertaining to a business over an accounting period, including a company's operations, financial position, and cash flows
   • The accounting process includes summarizing, analyzing, and reporting these transactions to a company's departments, oversight agencies, regulators, and tax collection entities

2. Types

   • Administrative Accounting
     • Emphasizes the preparation of a company's information for its internal users
   • Financial Accounting
     • Means through which various stakeholders can measure, evaluate and monitor the progress, stagnation or setback of the financial situation of the entities from the reading of the economic and financial data of quantitative nature
   • Cost Accounting
     • Allows to know the cost of production for products in industrial companies
   • Tax Accounting
     • Focused on preparing information for filing statements and paying taxes
   • Government Accounting
     • Summarizes all the financial activity from the public sector institutions of country

3. OBJECTIVES

   • Register and keep a record of business transactions
   • Facilitate decision-making for management
   • Communicate performance results
   • Meet legal requirements
   • Observe and evaluate the behavior of economic entities
   • Compare results with other periods and other economic entities
   • Evaluate results in light of established objectives

4. ECONOMIC ENTITY

   • Unit which maintains its own accounting records specific to the business operations
     • Sole entrepreneurs
     • Corporations
     • Partnerships
     • Limited liability partnerships
     • Limited liability companies

5. CHARACTERISTICS

   • Relevance
     • Produces useful Information that can influence the decision-making process
   • Reliability
     • Information is faithful, complete and presented without bias
   • Timeliness
     • Information is available at the proper time in order for it to be useful
   • Comparability
     • Produces standardized information so that it can be contrasted with that of other entities
   • Materiality
     • Information can be omitted, misstated or grouped without misleading the user
   • Verifiability
     • Information can be faithfully reproduced with similar results using similar methods
   • Consistency
     • Information is produced with the same methods throughout a period of time
   • Understandability
     • Information is comprehensible

Imagens e arquivos do mapa