Financial Management And Accounting

Accounting:

Accounting is the process of recording, classifying, summarizing, analyzing,

interpreting and communicating the result of financial transactions.

Features:

Financial character:
1. Assets that can be evaluated in terms of money such as furniture purchased, computer
purchased etc.
2. The things which cannot be evaluated in terms of money such as honesty, discipline
which are non financial character
3. Accounting keeps records of things that can be evaluated in terms of money.

Continuous and dynamic process:

1. Accounting is the dynamic process and continuous process it is performed continuously.

Based on principle/ assumption/ concept:

1. Accounting is based on the principles that are analyzed developed on the basis of
assumption of past and conceptualized and developed.

Ascertainment of profit and loss:

1. Accounting keeps record of every transaction of organization keeping record of them.

Ascertainment of financial position:

1. Accounting helps in keeping record of every asset and liabilities of organization keeping
record of them.
OBJECTIVES:

To keep permanent record of financial transactions:

Accounting keeps records of every financial transaction keeping tracks of every
expenditure and incomes.

To ascertain operating result of an organization:

Accounting keeps tracks of every transaction making easy to ascertain the profit and loss
of an organization.

To depict financial portion of an organization:

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To access tax liability of an organization:

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To help in decision making process:

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To safeguard of assets and properties of an organization:

Keeps records of the purchased number of goods and prevent the fraud and thieves that
may cause loss to the organization properties.

ADVANTAGES:

Helps to keep permanent record of financial transactions:

Accounting keeps records of every financial transaction keeping tracks of every
expenditure and incomes.

Helps to ascertain operating result of an organization:

Accounting keeps tracks of every transaction making easy to ascertain the profit and loss
of an organization.

Helps to depict financial portion of an organization:

 D

Helps to access tax liability of an organization:

Fgf

Helps to help in decision making process:

Dfsf

Helps to safeguard of assets and properties of an organization:

Keeps records of the purchased number of goods and prevent the fraud and thieves that
may cause loss to the organization properties.

Accounting concept/ assumption/ principle:

Business Entity concept:

Business organization and Owner business are two different entity or two different things.
Their transaction should not be mixed together otherwise the profit and loss of the
organization cannot be determined.
Hence, their records should me managed separately.