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Transcript

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