THE ROLE OF

ACCOUNTING IN
BUSINESS ORGANIZATION

Presented by: Uzair Gulzar Shaikh

OBJECTIVES
 Definition of Accounting.
 Importance of Accounting in business
organization.
 Role of Financial statement.
 Business organization without accounting.
 Conclusion.
DEFINE ACCOUNTING?
Accounting is a systematic art of recording, reporting &
analysis financial transactions of an organization.
or
Accounting is track of recording of financial
transactions.
The person who perform duty of recording financial
transactions that person is known as a Accountant.
IMPORTANCE OF ACCOUNTING IN BUSINESS
ORGANIZATION
Accounting plays great vital role in the field of
business organization. Accounting helps to organization to
understand the performance of business in past , present & in
future. Accounting helps organization to determine the accuracy
with which resources of organization should not waste.
Accounting is basic key framework that any
business is built upon. In daily business life organization
perform various activities which are directly based on
accounting principles. Organization analysis its financial
stability with the help of accounting records which organization
keep of its every transaction.
During the analyzing financial environment of an
organization accounting helps to take healthy decision
regarding the expansion of investment is good or not.
The implementation of proper accounting
practice & methodologies can be a good for an organization
to improve the organization from financially point of view.
An accounting help to organization to measure its profit &
loss. We can say accounting is systematical tool which help
organization to measure its numerical values. Nowadays
accounting become thirst for every organization without it
no organization can survive much more in modern
organizational society.
 In modern society every organization
wants to transfer its every activity into accounting
professional environment because it help to perform it
authentically. Once each & every activity of an
organization enter into accounting stream than it will
properly manage its finances. Thus accounting help to an
organization from every point of view to come up with
modern organizational society.
ROLE OF FINANCIAL STATEMENT

A business organization uses financial statement to

known about the financial position of an organization.
Financial statement divided into two parts: Balance sheet
& Income statement. Both of these things help business
organizations to understand the financial phenomena of
firm.
Balance sheet: It evident the clear picture of financial
condition of an organization. Balance sheet includes
Assets , Liabilities & Owners Equity.
Income Statement: An organization use to prepare income
statement, in order to measure the total Revenue &
Expenses of organization over a specific period of time.
Income statement evident the result of organization in
the shape of profit or loss. Organizations use to prepare
income statement for a specific period.
ORGANIZATIONS WITHOUT
ACCOUNTING

Business organization can not perform its functions

properly until & unless organization wont regulate
accounting tools in the operations of an organization.
Without accounting , organization face many problems
which may cause for the terrible effects on organization
from financially point of view.
Business organization can not make good
decisions in the sense of financially point of view ,
without the help of Accounting system. Business
organization is unable to analysis the numerical records
properly & it will cause for high loss for an
organization.
 Business organization can not measure net
income or loss without accounting system. When
organizations do not have proper information about the
financial situation of firm than it will cause for the
destruction of the business. So, we can say as blood
plays vital role for the human beings , in a same way
accounting also plays immense role in business
organization.
 CONCLUSION
As the aim of every organization is to perform better &
better , in order to achieve the great achievements. Thus
no organization can achieve immense result until &
unless organization wont regulate the accounting
principles in business organization. There is great
supportive hand of accounting behind the success of any
organization because it help to perform fruitful &
achieve fruitful achievement. So we can say organization
is value less without the accounting role. Thus, the role
of accounting in business organization is appericiatable.