Accounting is the process of recording, classifying, summarizing, analyzing, and interpreting financial transactions and events of a business or organization. The purpose of accounting is to
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Accounting is the process of recording, classifying, summarizing, analyzing, and interpreting financial transactions and events of a business or organization. The purpose of accounting is to provide financial information that can be used by stakeholders to make informed decisions about the entity.
In accounting, transactions are recorded in a systematic manner and summarized into financial statements, such as the balance sheet, income statement, and cash flow statement. These statements provide a snapshot of the financial health of the organization and are used to assess its profitability, liquidity, and solvency.
Accounting principles and standards are established by various organizations, including the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB), to ensure consistency and comparability in financial reporting across different entities and countries.
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