ACCOUNTS & FINANCE

Accounts-
• Accounting refers to a process with a series of steps related to keeping
a track of business activities of financial nature. After that, presenting
the same to its users.
• Accounting being the business language that communicates financial
information to its users. Hence, the basic objective of accounting is to
determine profit or loss, for a particular period.
• Accounting involves the creation, management, summation &
communication of day-to-day transactions of a business ultimately
leading to the preparation of financial statements.
Accounting Process

It is a seven-step process:
• Identification of Transaction
• Preparation of Documents
• Recording in Journal
• Ledger Posting
• Preparing Trial Balance
• Passing Adjusting Entries
• Preparation of final accounts, i.e. Income Statement, Balance Sheet and Cash
Flow Statement
Functions-
Objectives-
Accounting aims to:
1.Systematically record all the monetary transactions
2.Determine the outcome of the recorded transaction
3.Determine the financial position of business
4.Provide information to the users for making sound judgement
5.Know the company’s solvency status
Meaning of Finance

• Finance is all about money management, in a way that it is available at the time
when it is required. From the enterprise point of view, finance indicates all the
economic resources, which a company uses and mobilizes so as to grow it over
time.
• It is a process of arranging funds for any kind of expenditure and spending money.
It involves the allocation of funds in such a way that it can reap the highest return
over time.
• Finance has a wider scope and is mainly responsible to support in decision-
making such as investment, divestment, cash management, Working capital
management
Functions:-