Definition And Meaning Of Accounting
The American Institute of Certified Public Accountants (1941) defines ‘Accounting is the art of recording, classifying and summarising in significant manner and in terms of money, transactions and events which are in part, at least of a financial character and interpreting the results thereof.
IMPORTANCE OF ACCOUNTING
- Facilitates to replace memory and comply with legal requirements
- Facilitates to ascertain net result of operations and also to know the financial position
- Facilitates the users to take effective decisions
- It is helpful in a comparative study
- It assists the management
- It facilitates to have control over assets
- It facilitates the settlement of tax liability
- It facilitates raising of loans
- It acts as a legal evidence
- It facilitates ascertainment of value of business.
SCOPE
OF ACCOUNTING
- Identifying
- Measuring
- Recording
- Classifying
- Summarising
- Analysing
- Interpreting
- Communication
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