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Accounting
Accounting
Accounting
Accounting
Accounting
Accounting
Accounting
Accounting
Accounting
Accounting
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Accounting

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Transcript

  • 1. Accounting
  • 2. Meaning <ul><li>It is a systematic record of daily events of a </li></ul><ul><li>business. </li></ul><ul><li>Accounting in its elementary stages called as Book </li></ul><ul><li>Keeping </li></ul><ul><li>The modern accounting system was formulated by </li></ul><ul><li>Lucas Pacioli ( 1494 ) </li></ul>
  • 3. Definition <ul><li>AICPA: </li></ul><ul><li>“ It is the art of recording, classifying and </li></ul><ul><li>summarizing in a significant manner and in </li></ul><ul><li>terms of money, transactions and events which </li></ul><ul><li>are in part atleast of financial character and </li></ul><ul><li>interpreting the results thereof” </li></ul>
  • 4. Objectives <ul><li>Systematic & scientific record of events </li></ul><ul><li>Monitors operational efficiency </li></ul><ul><li>Effective control over inflows & outflows </li></ul><ul><li>Helps to have effective control over the state </li></ul><ul><li>of affairs </li></ul><ul><li>Permits comparison </li></ul><ul><li>To help different parties related to the </li></ul><ul><li>business </li></ul>
  • 5. Advantages <ul><li>It provides complete, systematic & accurate </li></ul><ul><li>record of business transactions </li></ul><ul><li>To understand the financial capabilities of the </li></ul><ul><li>organization </li></ul><ul><li>It provides information about decision making </li></ul><ul><li>It facilitates comparison of records </li></ul><ul><li>It provides information to investors & creditors </li></ul>
  • 6. Functions <ul><li>Keeping systematic record </li></ul><ul><li>Protecting properties of the business </li></ul><ul><li>Communicating the results </li></ul><ul><li>Meeting legal requirements </li></ul>
  • 7. Classifications <ul><li>Financial Accounting </li></ul><ul><li>Management Accounting </li></ul><ul><li>Cost Accounting </li></ul>
  • 8. Principles <ul><li>Accounting concepts: </li></ul><ul><ul><li>Separate Entity concept </li></ul></ul><ul><ul><li>Going Concern concept </li></ul></ul><ul><ul><li>Money Measurement concept </li></ul></ul><ul><ul><li>Cost concept </li></ul></ul><ul><ul><li>Dual Aspect concept </li></ul></ul><ul><ul><li>Accounting period concept </li></ul></ul><ul><ul><li>Periodic Matching concept </li></ul></ul><ul><ul><li>Realization concept </li></ul></ul>
  • 9. <ul><li>Accounting Conventions: </li></ul><ul><ul><li>Consistency </li></ul></ul><ul><ul><li>Full disclosure </li></ul></ul><ul><ul><li>Conservatism </li></ul></ul><ul><ul><li>Materiality </li></ul></ul>Principles
  • 10. Limitations <ul><li>Transactions in terms of money alone can be </li></ul><ul><li>Measured </li></ul><ul><li>Accounts ignore the changes in the valuation </li></ul><ul><li>of assets </li></ul><ul><li>Conflicts between the principles of accounting </li></ul><ul><li>It will be affected by the subjectivity factor </li></ul><ul><li>It is historical in nature </li></ul>

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