What are accounting and finance?

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I started to wonder what accounting and finance really are. So I started digging up information and here is what I could find.

 

First something about accounting. Accounting is something to do with the part of the total information system within the business. The accounting information system has certain features that are common to all information system within a business. This means that accounting provides financial information for a range of users to help them make better judgements and decisions. Accounting is about collecting, analyzing and communicating financial information. And that information is useful to those who need to control businesses and for those who need to make decisions and plan about the business. Accounting has two main features: financial and management accounting. Management accounting tries to meet the needs of managers and financial accounting tries to meet accounting needs of all the other users.

 

And then something about finance. Finance exist to help decision makers and also to help make better decisions. Finance is all about what business is about. It is concerned with the ways in which funds for business are raised and invested. It is important that funds are raised the appropriate way for the business. And finance should be able to help decision makers which way those funds should be invested so it will provide something useful for the business.

 

And now you are probably wondering why it is relevant to know something about accounting and finance even when you don’t work around them. Accounting and finance has an important role in business management. They also have many tasks which are obeying the law, creating budgets, analyzing performance and developing the business strategy.

 

Everyone who is somehow connected with business life should be a little aware of what accounting and finance really are. Accounting and finance, which is also called financial information, gives a huge influence in which ways business operates. Financial information also helps the managers to make decision based on that information and they are also the most important users of financial information. Financial information also gives something for the planning. Planning involves having a clear view of the business and where it is going and how it is going to get there.

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Sources:

Peter Atrill & Eddie McLaney: Accounting and finance for non-specialists, 2006.

smallbusiness.chron.com: The Role of Accounting & Finance in Business Management by Josh Fredman, Demand Media.

Pictures:

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http://www.topuniversities.com/sites/default/files/styles/panopoly_image_original/public/Accounting_and_fiance.jpg?itok=YLiDqiNj

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2 Responses to What are accounting and finance?

  1. piesnrol says:

    Interesting, readable & informative!

  2. samupekt says:

    Good post! Very informative.

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