Accounting is the practice of recording, analyzing, and reporting financial transactions. It plays a critical role in business by providing managers, investors, and other stakeholders with accurate data about a company's financial position.
Financial accounting is the branch of accounting that focuses on producing financial statements for external stakeholders such as shareholders, creditors, and regulatory bodies. The goal of financial accounting is to provide an accurate picture of a company's financial health that can be used to make informed decisions about investments or loans.
Management accounting provides internal decision-makers with information they need to manage a company effectively. This includes budget creation and analysis, cost control strategies, risk management practices and competitive analyses.
Tax accounting involves understanding tax laws specific to your geographical region or industry. Accountants who specialize in this area will work specifically on preparing income tax returns for individuals or organizations while ensuring compliance with all applicable regulations and mandates.
Auditing standards often vary depending upon country regulation requirements however auditors perform important processes which are universally beneficial.They examine cash flow within companies as well as payment system implementation; ensure appropriate governance among employees; handle licensing requirements according government policies; assure Government grant funding utilization toward milestones achieved ONLY (not towards personal usage) identify fraudulence mechanisms (internal & external).
Bookkeeping methods include keeping accurate transaction records & balancing accounts properly between different parties involved against those transactions.As mentioned before this can be important from tax preparation perspective.Digital software have made book keeping much efficent task than dealing manuall books ledgers before computerized systems came into use .
