This document provides an overview of accounting concepts including the accounting process, limitations of accounting, and the accounting equation. It defines accounting as identifying, measuring, and communicating financial information to help users make decisions. It also defines management accounting and describes the objectives and functions of management accounting such as furnishing relevant data, compiling data, analysis, interpretation, planning, and decision making. The document outlines some limitations of accounting including that it is historical, influenced by conventions and judgments, principles are not static, and it does not consider inflation. It concludes with an explanation of the accounting equation that assets equal liabilities plus owner's equity.

1.  SUBMITTED TO
 ANKIT SIR…
MANAGEMENT ACCOUNTING
 SUBMITTED BY
 SAURABH VERMA (B.COM1)

2. PRESENTATION ON
:-
-> ACCOUNTING PROCESS
-> LIMITATION OF ACCOUNTING
-> ACCOUNTING EQUATIONS

3. Accounting Equation

4. Assets = Owner’s Equity + Liabilities
Items of
value
owned
by the
business
The funds of a
business provided
by its owners and
the profits entitled
to him
Debts owed
by a
business to
external
parties such
as suppliers

5. Assets = Owner’s Equity + Liabilities
Building
Motor vehicle
Office Equipment
Fixtures
Stock (closing)
Cash in hand
Cash at bank
Capital
Profits
Creditors
Loan from bank
Other creditors
* Explain these terms to students

6. Assets = Owner’s Equity + Liabilities
Every transaction will affect 2 items.
The equation will still balance!

7. MEANING
ACCOUNTING AS AN INFORMATION IS THE
PROCESS OF IDENTIFYING MEASURING AND
COMMUNICATING THE ECONOMIC INFORMATION
OF AN ORGANIZATION TO ITS USERS WHO NEED
THE INFORMATION FOR DECISION MAKING …
IT IDENTIFIES TRANSACTIONS AND EVENTS OF A
SPECIFIC ENTITY

8. DEFININATION
 A/C is ‘’ the art of recording , classifying and summarizing in a significant
manner and in the term of mony , transactions and events which are in a
part at least , of a financial character and interpreting the result thereof’’…
 Management A/C ‘’is a term used to describe the accounting methods ,
systems and techniques which coupled with special knowledge and ability
assist management in its task of maximizing profit and minimizing
losses’’…

9. OBJECTIVES OF ACCOUNTING
 To keep systematic record...
 To ascertain the financial position of the business…
 To portray the liquidity position…
 To protect business properties…
 To facilitate rational decision making…
 To satisfy the requirements of law…

10. FUNCTIONS OF MANAGEMENT
ACCOUNTING
 Furnishing relevant and vital data…
 Compilation of data in suitable form…
 Analysis and interpretation…
 planning…
 Decision making…

11. LIMITATIONS OF ACCOUNTING
 Accounting is histrocial in nature; It does not reflects the current financial
position or worth of a business….
 Facts recorded in financial statement are greatly influenced by accounting
conventions and personal judments of the accountant or management..
Valuation of inventory , provision for doubtful debts and assumption about
useful life of an asset may , therefore , different from business house to
other…
 Accounting principle are not static or unchanging – alternative accounting
procedures are often equally acceptable.. Therefore , accounting
statements do not always present comparable data…

12.  -> Cost concept is found in accounting … price changes are not considered… Money
value is bound to change often from time to time…This is a strong limitation of
accounting…
 ->Accounting statements do not show the impact of inflation…

13. THANK YOU