Accounting

Introduction
BOSS NAIK ACCOUNTING SERIES
Objectives

Define “Accounting” Forms of Business

Nature and Purpose Organization
Branches of Accounting
Functions of Accounting in Types of Business According to
business Activities
Users of Accounting
information
Definition of Accounting
Accounting is the process of identifying, recording and communicating economic
information that is useful in making economic decisions.

• Business Transactions whether it is

Identify an accountable event or non-
accountable event.

• The identified accountable events

Record then classify the effects of the event
into accounts.

• The results to interested users by the

Communicate way of Financial Statements.
Nature of Accounting
Accounting is a process with the primary purpose of providing information about
economic entities that is intended to be useful in making economic decisions.

Information Accounting
FS
INPUT PROCESS OUTPUT
 Accounting as Social Science

Accounting
Accounting Cycle Functions and
Concepts and Principles Principles
Accounting as an ART
• Business Transactions whether it is
Identify an accountable event or non-
accountable event.

• The identified accountable events

Record then classify the effects of the event
into accounts.

• The results to interested users by the

Communicate way of Financial Statements.
Bookkeeping vs. Accounting
Bookkeeping refers to the recording of the accounts or transactions of an entity.
Accounting is the process of identifying, recording, and communicating information
to interested users.

Bookkeeping Accounting
Identify the Transaction Identify the Transaction
Record the Transaction Record the Transaction
Communicate to Interested Communicate to Interested
Users Users
Users of Financial Information
External Users
Not Directly Involved
Managing the business
Investors, Lenders, Creditors, Government agencies
Employees, Customers, Public
Users of Financial Information
Internal Users
Directly Involved
Managing the business
Business Owners, Board of Directors, Management
Internal and External Users

nv o lv ed Internal Users
i
e c tly
Dir
Users of Financial
Information
No
tD
irec
tly
inv
olv
ed External Users