Accounting and the Different Parties Concerned

accounting & bookkeeping and accounting”>>accounting services visit “>Bookkeeping or accounting data worked on by the accounting cycle will generate the relevant accounting information. In the process, the essential data is collected, classified, tabulated and summarized in a way as to present the same in the structure of clear information for use by the top management. These reports or information will enable them to take informed and wise decisions. Bookkeeping data comprises financial transactions occurring in an organisation during the accounting period. And, one of the foremost functions of accounting section is to collect the data that are correlated with the vouchers. This is carried out to ensure the authenticity of the entries.

Accounting process is carried out by recording data in the books of original entry, posting the same into a ledger, placing transactions of similar nature under a single title in one account, determining the value at the end of the year by balancing, tabulating the lists of balances to check for arithmetical consistency and accuracy, and finally by making the financial statements of Profit and Loss and Balance Sheet. But, in the recent years, this arduous task is managed by various accounting software. There are several advantages by resorting to the latest happenings in technology as these soft wares can finish the tasks at hand in a very efficient manner; and that too, in a short span of time. Mostly, the important accounting information is presented in the form of Income statements and Position statements or Balance sheets. In the modern world of business, reports and statements indicating the changes in the financial position, reports on human resources accounting and social performance reports are the aspects that make up the accounting information.

The different parties or entities that are interested in the accounting information are the top management, researchers, government, creditors, consumers and employees. The bookkeeping information is of interest to persons and individuals who are directly and indirectly involved with an organisation or enterprise. While small and medium size businesses are generally carried on by a single person or by a few partners, a large business is usually run by constituting an incorporated company where there is a separation of management activities from ownership. The management’s responsibility lies in the efforts to operate the business related aspects in an efficient way. It will also try to reap maximum returns on the capital without imperilling the fund pool of the company.

Even though the original owners are the people that initiate contributing to the fund of a business, they can lay claim on the equity’s return only after paying others. After distributing the entire required amount towards employee salary and interest, profit can be distributed as a reasonable return on the capital they have invested. In all possibility, the owners will be interested in the safety of their investment. They will always be on the look-out for a reasonable return, which in turn, rests on the organisation’s stability and reputation. Accounting reports takes care of the past performance in addition to assisting in the future prospects of the organisation or entity.

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