Accounting Measurement of Financial Information about businesses and processing, and communication of financial and non-financial information

Accounting Measurement of Financial Information, processing, and communication of financial and non-financial information about economic entities such as businesses and corporations. Accounting or Accountancy, which has been called the “language of business”, measures the results of an organization’s economic activities, and conveys this information to a variety of users, including investors, creditors, management, and regulators. Practitioners of accounting are known as accountants. The terms “accounting” and “financial reporting” are often used as synonyms.

Accounting Measurement of Financial Information

Financial Accounting

Accounting can be divided into several fields including financial accounting, management accounting, external, tax accounting, and cost accounting. Accounting information systems are designed to support accounting functions and related activities. Financial accounting focuses on the reporting of an organization’s financial information, including the preparation of financial statements, to the external users of the information, such as investors, regulators, and suppliers; and management accounting focuses on the measurement, analysis, and reporting of information for internal use by management. The recording of financial transactions, so that summaries of the financials may be presented in financial reports, is known as bookkeeping, of which double-entry bookkeeping is the most common system.

Even though Accounting Measurement of Financial Information has existed in various forms and levels of sophistication throughout many human societies, and the double-entry accounting system in use today was developed in medieval Europe, particularly in Venice, and is usually attributed to the Italian mathematician and Franciscan friar Luca Pacioli. Today, Accounting Measurement of Financial Information is facilitated by accounting organizations such as standard-setters, accounting firms, and professional bodies. Financial statements are usually audited by accounting firms and are prepared in accordance with generally accepted accounting principles (GAAP). GAAP is set by various standard-setting organizations such as the Financial Accounting Standards Board (FASB) in the United States and the Financial Reporting Council in the United Kingdom. As of 2012, “all major economies” have plans to converge towards or adopt the International Financial Reporting Standards (IFRS).

Bookkeeping Measurement of Financial Information

Financial Bookkeeping Measurement of Financial Information focuses on the reporting of an organization’s financial information to external users of the information, such as investors, potential investors, and creditors. It calculates and records business transactions and prepares financial statements for the external users in accordance with generally accepted accounting principles (GAAP). GAAP, in turn, arises from the wide agreement between accounting theory and practice, and change over time to meet the needs of decision-makers.

Financial accounting produces past-oriented reports—for example, financial statements are often published six to ten months after the end of the accounting period—on an annual or quarterly basis, generally about the organization as a whole.

This branch of Accounting Measurement of Financial Information is also studied as part of the board exams for qualifying as an actuary. These two types of professionals, accountants, and actuaries, have created a culture of being archival.

Management accounting

Management accounting focuses on the measurement, analysis, and reporting of information that can help managers in making decisions to fulfill the goals of an organization. In management accounting, internal measures and reports are based on cost-benefit analysis and are not required to follow the generally accepted accounting principle (GAAP). In 2014 CIMA created the Global Management Accounting Principles (GMAPs). The result of research from across 20 countries on five continents, the principles aim to guide best practice in the discipline.

Management Accounting Measurement of Financial Information produces past-oriented reports with periods that vary widely, but it also encompasses future-oriented reports such as budgets. Management accounting reports often include financial and non-financial information, and may, for example, focus on specific products and departments.

Financial Audits

Auditing is the verification of assertions made by others regarding a payoff,[36] and in the context of accounting it is the “unbiased examination and evaluation of the financial statements of an organization”. An audit is a professional service that is systematic and conventional. (We do not provide audits).

An audit of financial statements aims to express or disclaim an independent opinion on the financial statements. The auditor expresses an independent opinion on the fairness with which the financial statements present the financial position, results of operations, and cash flows of an entity, in accordance with the generally acceptable accounting principle (GAAP) and “in all material respects”. An auditor is also required to identify circumstances in which the generally accepted accounting principles (GAAP) have not been consistently observed or Accounting Measurement of Financial Information is erroneous.