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Accounting, or accountancy, is the measurement

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Accounting, or accountancy, is the measurement, processing and communication of financial
information about economic entities.
[1][2]
Accounting, which has been called the "language of
business",
[3]
measures the results of an organization's economic activities and conveys this
information to a variety of users including investors, creditors, management,
and regulators.
[4]
Practitioners of accounting are known as accountants.
Accounting can be divided into several fields including financial accounting, management
accounting, auditing, and tax accounting.
[5][6]
Financial accounting focuses on the reporting of an
organization's financial information, including the preparation of financial statements, to external users
of the information, such as investors, regulators and suppliers;
[7]
and management accounting
focuses on the measurement, analysis and reporting of information for internal use by
management.
[1][7]
The recording of financial transactions, so that summaries of the financials may be
presented in financial reports, is known as bookkeeping, of which double-entry bookkeeping is the
most common system.
[8]
Accounting is facilitated by accounting organizations such as standard-setters, accounting
firms and professional bodies. Financial statements are usually audited by accounting firms,
[9]
and are
prepared in accordance with generally accepted accounting principles (GAAP).
[7]
GAAP is set by
various standard-setting organizations such as the Financial Accounting Standards Board (FASB) in
the United States
[1]
and the Financial Reporting Council in the United Kingdom.
[10]
As of 2012, "all
major economies" have plans to converge towards or adopt the International Financial Reporting
Accounting Basics: The Accounting Process
By Bob Schneider A A A
Filed Under: Accounting Financial Theory, Financial Theory, Accounting
By Bob Schneider
As implied earlier, today's electronic accounting systems tend to obscure the
traditional forms of the accounting cycle. Nevertheless, the same basic
process that bookkeepers and accountants used to perform by hand are
present in today's accounting software. Here are the steps in the accounting
cycle:
(1) Identify the transaction from source documents, like purchase orders,
loan agreements, invoices, etc.
(2) Record the transaction as a journal entry (see the Double-Entry

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Bookkeeping Section above).
(3) Post the entry in the individual accounts in ledgers. Traditionally, the
accounts have been represented as Ts, or so-called T-accounts, with debits
on the left and credits on the right.
(4) At the end of the reporting period (usually the end of the month), create
a preliminarytrial balance of all the accounts by (a) netting all the debits and
credits in each account to calculate their balances and (b) totaling all the left-
side (i.e, debit) balances and right-side (i.e., credit) balances. The two
columns should be equal.
(5) Make additional adjusting entries that are not generated through specific
source documents. For example, depreciation expense is periodically
recorded for items like equipment to account for the use of the asset and the
loss of its value over time.
(6) Create an adjusted trial balance of the accounts. Once again, the left-side
and right-side entries - i.e. debits and credits - must total to the same
amount. (To learn more see,Fundamental Analysis: The Balance Sheet.)
(7) Combine the sums in the various accounts and present them in financial
statements created for both internal and external use.
(8) Close the books for the current month by recording the necessary
reversing entries to start fresh in the new period (usually the next month).
Nearly all companies create end-of-year financial reports, and a new set of
books is begun each year. Depending on the nature of the company and its
size, financial reports can be prepared at much more frequent (even daily)
intervals. The SEC requires public companies to file financial reports on both
a quarterly and yearly basis.

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 Accounting, or accountancy, is the measurement, processing and communication of financial information about economic entities.[1][2] Accounting, which has been called the "language of business",[3] measures the results of an organization's economic activities and conveys this information to a variety of users including investors, creditors, management, and regulators.[4] Practitioners of accounting are known as accountants. Accounting can be divided into several fields including financial accounting, management accounting, auditing, and tax accounting.[5][6] Financial accounting focuses on the reporting of an organization's financial information, including the preparation of financial statements, to external users of the information, such as investors, regulators and suppliers;[7] and management accounting focuses on the measurement, analysis and reporting of information for internal use by management.[1][7] The recording of financial transactions, so that summaries of the financials may be presented in financial reports, is known as bookkeeping, of which double-entry bookkeeping is the most common system.[8] Accounting is facilitated by accounting organizations such as standard-setters, accounting firms and professional bodies. Financial statements are usually audited by accounting firms,[9] and are prepared in accordance with generally accepted accounting principles (GAAP).[7] GAAP is set by various standard-setting organizations su ...
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