Accounting and Financial Information

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Description

Accounting is often called “the language of business” because it communicates so much of the information that owners, managers, and investors need to evaluate a company’s financial performance. These people are stakeholders in the business—they’re interested in its activities because they’re affected by them. The financial futures of owners and other investors may depend heavily on strong financial performance from the business, and when performance is poor, managers may be replaced or laid off in a downsizing. In fact, a key purpose of accounting is to help stakeholders make better business decisions by providing them with financial information. You shouldn’t try to run an organization or make investment decisions without accurate and timely financial information, and it is the accountant who prepares this information. More importantly, accountants make sure that stakeholders understand the meaning of financial information, and they work with both individuals and organizations to help them use financial information to deal with business problems. Actually, collecting all the numbers is the easy part. The hard part is analyzing, interpreting, and communicating the information. Of course, you also have to present everything clearly while
effectively interacting with people from every business discipline. In any case, we’re now ready to define accounting as the process of measuring and summarizing business activities, interpreting financial information, and communicating the results to management and other
decision makers.

Creator

Stephen J. Skripak

Source

https://vtechworks.lib.vt.edu/bitstream/handle/10919/70961/Chapter%2016%20Accounting%20and%20Financial%20Information.pdf?sequence=21&isAllowed=y

Publisher

Pamplin College of Business and Virginia Tech Libraries

Contributor

Rahmah Agustira

Rights

Creative Commons

Type

Files

2.pdf

Citation

Stephen J. Skripak, “Accounting and Financial Information ,” Open Educational Resource (OER) , accessed April 17, 2021, http://oer.iain-padangsidimpuan.ac.id/items/show/162.

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