Accounting is at the heart of
business: accounting information pulsates throughout an organization,
feeding decision makers with details needed to give them an edge over
competitors. Because of new technologies, the increasing speed and
quantity of information available makes the task for accountants an
ever-increasing challenge. Decision makers cannot rely on hunches and
guesses. Decision makers depend on their knowledge of accounting
principles and practices to help identify and take advantage of
opportunities discovered from reviewing large volumes of information.
Accounting is at
the heart of business: accounting information pulsates throughout an
organization, feeding decision makers with details needed to give them
an edge over competitors. Because of new technologies, the increasing
speed and quantity of information available makes the task for
accountants an ever-increasing challenge. Decision makers cannot rely
on hunches and guesses. Decision makers depend on their knowledge of
accounting principles and practices to help identify and take advantage
of opportunities discovered from reviewing large volumes of
information.
Power of Accounting
Accounting
is an information system that identifies, measures, records and
communicates relevant, reliable, consistent and comparable information
about an organization’s economic activities. Its objective is to help
people make better decisions. It also helps people better assess
opportunities, products, investments, and social and community
responsibilities. In addition to reporting on the performance of a
business, what the business owns, and what it owes, accounting opens
our eyes to new and exciting possibilities.
Focus of Accounting
Accounting
affects many parts of life. Some examples of common contacts with
accounting are through credit approvals, chequing accounts, tax forms,
and payroll. These experiences are limited and tend to focus on the recordkeeping (or bookkeeping) part of accounting. Recordkeeping, or bookkeeping,
is the recording of financial transactions and events, either manually
or electronically, for the purpose of creating a reliable bank of date.
Accounting involves the recordkeeping process but is much more.
Accounting
also involves designing information systems to provide useful reports
to monitor and control an organization’s activities. In order to use
the reports effectively, decision makers must be able to interpret the
information. The skills needed to understand and interpret accounting
information come from an insight into each aspect of accounting,
including recordkeeping. Because accounting is part of so much that we
do in business and our everyday lives, you can enjoy greater
opportunities if you understand and are able to use accounting
information effectively.
Role of Bookkeeper
A Bookkeeper
is usually responsible for writing up the ‘daybooks’. The daybooks
consist of purchases, sales, receipts and payments. The bookkeeper is
responsible for ensuring that all transactions are recorded in the
correct daybook, supplier ledger, customer ledger and general ledger.
The bookkeeper will bring the books to the trial balance stage for a
financial accountant. This accountant will prepare the profit and loss
statement and balance sheet using the trial balance and ledgers
prepared by the bookkeeper.
I recommend you
to read one of the following books that can help you get familiar with
accounting and bookkeeping procedures. You can find these books in "Our
Best Picks" Section of Vision Ezine
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