Accounting is famously known as the “language of business”. Through the financial statements, the end-product reports in accounting, it delivers information to different users. Accounting is a means through which information about a business entity is communicated.
The American Institute of Certified Public Accountants (AICPA) defines accounting as:
Types Of Accounting:
- Financial accounting. This field is concerned with the aggregation of financial information into external reports. There are several career tracks involved in financial accounting.
- Public accounting. This field investigates the financial statements and supporting accounting systems of client companies, to provide assurance that the financial statements assembled by clients fairly present their financial results and position.
- Government accounting. This field uses a unique accounting framework to create and manage funds, from which cash is disbursed to pay for a number of expenditures related to the provision of services by a government entity.
- Forensic accounting. This field involves the reconstruction of financial information when a complete set of financial records is not available.
- Management accounting. This field is concerned with the process of accumulating accounting information for internal operational reporting.
- Tax accounting. This field is concerned with the proper compliance with tax regulations, tax filings, and tax planning to reduce a company’s tax burden in the future.
- Internal auditing. This field is concerned with the examination of a company’s systems and transactions to spot control weaknesses, fraud, waste, and mismanagement, and the reporting of these findings to management.