Khmer98-Drama

    1. INTRODUCTION TO ACCOUNTING AND BOOKKEEPING

    Accounting is one of the key functions for almost any business; 
it may be handled by a bookkeeper and accountant at small firms
 or by sizable finance departments with dozens of employees
 at larger companies.

    Definitions: Accounting

   The systematic and comprehensive recording of financial

transactions pertaining to a business and the process of summarizing, analyzing and reporting these transaction. A systematic process of identifying recording, measuring, classifying, verifying, summarizing, interpreting and communicating financial information.

the process of identifying, measuring, and communication economic information to permit informed judgements and decision by users of the information.

Accounting is a term that covers both of the following:

• Bookkeeping: maintaining a system of accounting records that captures and summaries business transactions and other items of a financial nature: and 
• Financial reporting : preparing financial statements which allow users of those statements to understand the financial position and the financial performance of an entity.       

Accounting information is needed by business of all type and size including:

sole trader, partnerships and companies. its also needed by entities that exist for a reason other than making a profit. such not for -profit entities include charities, societies and government departments. this text will explain bookkeeping for a business but remember that much of what is covered would also be relevant to other types of entity.

Accounting information is provided for use both:

• Internally, providing management with information needed to run the entity(known as management accounting), and 
• Externally, providing information for other interested parties to understand the position and performance of an entity. For example =, a company produce accounting information for its shareholders in the form of financial statements, and financial statement are also used by tax authorities, investor, trade union representative and others.( This is known as financial accounting)