FIELDS IN ABM STRAND (General Overview of Accountancy)

A General Overview on Accountancy

Accounting is a field that has to do with the measurement, processing, and relaying of financial information with regards to economic entities, such as corporations and businesses. The accounting field has been called the “language of business” because it measures and facilitates the results of an organization’s economic activities.

Practitioners of accounting are known as “accountants”. Another term synonymous with accounting is “financial reporting”.

Modern accounting has been defined as the keeping and preparing of an entity’s financial records. The main job of a professional accountant mainly involves the verification and analysis of such records through the fundamental principles and procedures of accounting.

Let’s explore the main fields in accounting:

• Financial Accounting

Financial accounting centers on the reporting of an organization’s financial information for creditors, investors, and potential investors. It involves the calculation and recording of business transactions as to prepare financial statements for said external users in accordance with the GAAP or Generally Accepted Accounting Principles.

• Management Accounting

Management accounting is focused on the measurement, analysis, and reporting of information as to assist managers in making the right decisions that are geared towards the fulfillment of an organization’s main objectives and goals.

In the field of management accounting, internal reports are based on cost-benefit analysis, and are not required to adhere to the GAAP.

• Auditing

Auditing is basically the verification of assertions that were made by others with regards to payoffs. In the field of accounting, this refers to the unbiased examination and evaluation of an organization’s financial statements. An audit is a professional service that is conventional and systematic.

• Accounting Information Systems

Accounting information systems are an integral part of an organization or company’s overall information system that is centered on processing its accounting data. There are many corporations that utilize artificial intelligence-based information systems.

The banking and finance industry uses artificial intelligence for customer services and is also used for cybersecurity. Accounting information systems utilize both computer hardware and software systems for statistics and modeling.

• Tax Accounting

Corporate and personal income are taxed at varying rates, both in accordance with income levels with different marginal rates. Tax accounting generally concerns the recording, examination, and analysis of an individual or company’s tax rates and their adherence to tax policies.