ACC-1A Lecture Notes - Lecture 1: Financial Statement, Accounting
Document Summary
Accounting is an information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization"s business activities. Identifying requires selection of relevant transactions and events. Recording requires keeping a chronological log of transactions and events measured in dollars. Communicating requires preparing accounting reports (such as financial statements) that we analyze and interpret. Most common contact with accounting is through credit approvals, checking accounts, tax forms, and payroll. Recordkeeping (bookkeeping)is the recording of transactions and events, either manually or electronically. Language of business because all organizations set up an accounting information system to communicate data to help people make better decisions. Lenders, shareholders, governments, consumer groups, external auditors, customers. External users are not directly involved in running the organization. They have limited access to an organization"s information. Financial accounting the area of accounting aimed at serving external users by providing them with general-purpose (broad range) financial statements. List of external users and decisions they make.
