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accounting definition

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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. The terms accounting and financial
reporting are often used as synonyms.
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 Standards (IFRS).
[11]

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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 var ...
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