AN ACCOUNTING OVERVIEW

Accounting is frequently called the “language of business” because of itsability to communicate financial information about an organization. Various interested parties, such as managers, potential investors, creditors, and the goverment, depend on a company’s accounting system, therefore, muse include accurate collecting, recording, classifying, summarizing, and reporting of information on the financial status of an organization.
In order to achieve a standardizet system, the accounting process follows accounting principles and rule. Regardless of the type of business or the amount of money involved, common procedures for handling and presenting financial informations are used, incoming money ( revenues ) and autgoing money ( expenditures ) are carefully monitored, and transactions are summazired in financial statements, which reflect the major financial activities of an organization.
Two comon financial statements are the balance sheet and the income statemen. The balance sheet shows the financial positation of a company at one point in time, while yhe income statement shows the financial performance of a company over a period of time. Financial statements allow interested parties to compare one organization to another and/or to compare the most recent income statements of two corporations in order to find out which one would be a better invesment.
People who specialize in the field of accounting are known as accountants. In the United States, accountants are usually classified as public, private, or govermental, public accountants work independently an provide accounting services such as auditing and tax computations to companies and induviduals. Public accountants may earn the title of CPA ( Certified Public Accountant ) by fulfilling rigorous requirements, Private accountants work solely for private companies or comporations that hire them to maintain financial records, and govermmental accountant work for govermmentl a agencies or bereaus. Both private and govermmental accountants are paid on a salary basis, whereas public accountants receive fees for their services.
Through effective application of commonly accepted accounting systems, private, public and govermmental accountants provide accurate and timely financial information that is necessary for organizational decision-making.