Accounting, Financial Management

Accounting:

Many people believe financial management only relates to bookkeeping and the establishment of accounting reports which reflect those transactions in the books.  While accounting is certainly a major part of an organisation's financial management framework, accounting is mainly viewed as a method of recording.

Accounting is the process of identifying, measuring and communicating financial information. 

Broken down, these elements can be explained as follows:

  • Identifying: Accounting identifies transactions within the organisation. The transactions are the key. Every source of revenue (commissions in) should be recorded, as should every expense (salary payment, advertising costs, parking reimbursement).
  • Measuring: Accounting takes the raw data captured through the identification process (the records of the transactions) and converts it into information. This conversion process classifies the raw data into logical groupings such as dividing expenses into logical areas (wages, stationery, utilities).
  • Communicating: Using the information derived through the identification and measurement process, accounting reports then communicates that information to the interested parties

Accounting can be divided into many areas, however for the purposes of this module we will focus on two major subsets of accounting, namely Financial Accounting and Management Accounting.

Posted Date: 10/1/2012 3:55:52 AM | Location : United States







Related Discussions:- Accounting, Assignment Help, Ask Question on Accounting, Get Answer, Expert's Help, Accounting Discussions

Write discussion on Accounting
Your posts are moderated
Related Questions
Inventory T ur nover In the accounting, a measure of the number of times that the average amount of inventory on hand is sold within a given time of period. In the o

Standard Deviation An investment must be evaluated on two dimensions - rate of return and risk. An investor cannot enjoy a high return without any exposure to risk.  The higher

Ask questiSuggestion regarding Credit limit. Should it be approved or not, what should be the amount of credit limit that electronics give to Booth Plastics.

Q. Importance of the Cost of Capital? Importance of the Cost of Capital:- (1) Useful in Designing the Capital Structure: - The perception of cost of capital plays a very imp

Why do financial managers calculate the marginal tax rate? Financial managers utilize marginal tax rates to calculate the future after-tax cash flows from investments.  Ever si

The Beta Corporation has an optimal debt ratio of 40%. Its cost of equity capital is 12% and its before-tax borrowing rate is 8%.  Given a marginal tax rate of 35%, calculate (

Fixed income security is a financial obligation of an entity, which promises to pay a pre-specified amount of money at per-specified date. Debt securities (

Briefly discuss the three approaches to the short-term financing problem and provide relevant examples of each?

To determine Henkel's corporate beta, unlever (and relever) the ordinary least squares (OLS) market betas for each company in the European Household and Personal Care segment. Pric

the procedures, techniques or strategies that could or should be implemented to reduce the likelihood of harm > actions that could be taken to eliminate the hazard or reduce the r