Accounting is the systematic process of recording, reporting and analysing/measuring the financial transactions and financial performance of any business.
The objective of accounting is to provide useful accounting information to users such as entity’s owners, creditors, investors, managers, employees, unions, government bodies, investment advisers etc. Accounting assists accurate development and enforcement of key contracts.The main types of accounting are: financial accounting, management accounting and tax accounting.
The entity’s management is primarily responsible for the accounting function. This responsibility is usually delegated to the head of Finance department who is typically required to follow and apply the Generally Accepted Accounting Principles (GAAP) in USA or International Financial Reporting Standards (IFRS) in the rest of the world. It is important that accountants adhere to the highest level of professional ethics and ethical business conduct when managing a company’s accounts.