Accountancy
Accountancy is the art of communicating financial information about an individual or company to users such as shareholders and directors as well as interested third parties, such as your bank manager. The communication is generally in the form of financial statements that show the economic resources under the control of the business; the art of accountancy lies in selecting the right information that is relevant to the specific user and is reliable.
Accounting can be formally defined as “the art of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events which are, in part at least, of financial character, and interpreting the results thereof.”
Accounting that concentrates on reporting to people inside the business entity is called management accounting and is used to provide information to employees, managers, owner-managers. Management accounting is concerned primarily with providing a basis for making management or operating decisions.
Accounting that provides information to people outside the business entity is called financial accounting and provides information to current and potential shareholders, creditors, (such as banks or vendors) financial analysts, economists, and government agencies. Because these users have different needs, financial accounting is very structured and subject to many more rules than management accounting.
Machon Accounting has vast experience of all aspects of accounting – contact adrian@machonaccounting.com to discuss matters further.
