Financial Accounting

Description

Financial accounting is the process of recording, summarising and reporting the myriad of transactions from a business, so as to provide an accurate picture of its financial position and performance. Its primary objective is the preparation of financial statements including the balance sheet, income statement and cash flow statement that encapsulates the company’s operating performance over a particular period, and financial position at a specific point in time. These statements which are generally prepared quarterly and annually, and in accordance with Generally Accepted Accounting Principles (GAAP) are aimed at external parties including investors, creditors, regulators and tax authorities.
Financial capital maintenance can be measured in either nominal monetary units or units of constant purchasing power. The fundamental need for financial accounting is to reduce principal agent problem by measuring and monitoring agents’ performance and reporting the results to interested users.
The key difference between financial and managerial accounting is that financial accounting is aimed at providing information to parties outside the organisation, whereas managerial accounting information is aimed at helping managers within the organisation make decisions.
What is budgeting? What are the effects of involvement on the processes mediating
on-line brand evaluations? What is the impact of credit rating agencies on the value of economic securities? The book answers all these questions and more.