AFM131 Chapter Notes - Chapter 16: International Accounting Standards Board, Chartered Professional Accountant, Tax Accounting In The United States

• School: University of Waterloo
• Department: Accounting & Financial Management
• Course: AFM131
• Professor: David H A

Document Summary

Module 8: role of accounting and financial information. A(cid:272)(cid:272)ou(cid:374)ti(cid:374)g (cid:396)epo(cid:396)ts a(cid:374)d fi(cid:374)a(cid:374)(cid:272)ial state(cid:373)e(cid:374)ts (cid:396)e(cid:448)eal (cid:373)u(cid:272)h a(cid:271)out a (cid:271)usi(cid:374)ess" health. Almost impossible to understand business operations without being able to read, understand, and analyze accounting reports and financial statements. Businesses often survive or fail according to how well they handle financial procedures. Financial management is crucial to competitive business: accounting information keeps financial management stable. Accounting: recording, classifying, summarizing, and interpreting financial events: provide management, think of transactions. The accounting system: record and summarize accounting data, 3 step process. Recording: entries are made into journals. Classifying: effects of these journal entries are transferred or posted into ledgers. Report financial information about firm to interested stakeholders: employees, owners, creditors, suppliers, unions, community activists. Accounting is divided into 5 key working areas: managerial accounting, financial accounting, auditing, tax accounting, government and not-for-profit accounting. Provides information and analyses to managers inside the organization: assist in decision making.