For many people, accounting is seen only as a legal obligation, which must be there because there is no choice, ignoring what is important and how useful it can be. Accounting is perhaps the most important element in any company or business, as it allows knowing the financial and economic situation of the company, its evolution, trends and what to expect from it. Accounting allows not only knowing the past and present of a company, but also the future. Accounting provides extensive knowledge and allows full control of the company. It allows accurate decisions and tells us in advance, what will happen. Everything about the company is reflected in the accounts. Accounting is much more than a few books and financial statements. For the small businesses, accounting is simply an expense that they try to avoid at all costs. They actually ignore the tool that could allow them to properly manage their cash, inventories, accounts receivable and payable, liabilities, costs and expenses and their income. Having global knowledge about the enterprise and how it works allows the manager to make better decisions, anticipate difficult situations, or to provide great opportunities that otherwise cannot be foreseen and therefore cannot be taken as an advantage. Accounting is undoubtedly the best tool you can have to get to know your business, not caring is just throwing out possibilities for improvement or even the possibility of detecting flaws.
The importance of accounting
Accounting was born out of the needs of business practices and developed in parallel with developments in the economy. Accounting plays an increasing role in the economy and satisfies:
Technical and organizational progress
Development of international trade in goods
International capital flows
Requirements for environmental protection, etc
Accounting is growing most rapidly considering today's dynamically developing market economy. It consists of economic, environmental, technical, social, environmental and educational factors. Accounting allows management of economic evaluations of economic activity. Accounting is defined as the language of the business world since it determines the proper conduct of the business. To ensure the implementation of the tasks facing the accounting is necessary to specify the conditions and principles that should be observed in the conduct. Usefulness of accounting depends on many factors such as:
The reliability and uniformity of the figures by providing comparison to the initial plan
Completeness of data (use of materials, time etc) permitting determination of a full and accurate picture of the current situation
Importance of accounting, according to Deegan, Craig, Unerman and Jeffrey
According to Deegan, Craig, Unerman and Jeffery, accounting is a process which provides transparency to the people reviewing the accounts of an organization. Bias free information should be provided to the users which would help them evaluate the organizations current standing and stance. Deegan, Craig, Unerman and Jeffery suggest that the goal of accountants should be to represent proper accounting as it reflects the economics of the place in which the organization works and additionally, the internal economics of the place are also worth noting and ...