Account



Accounting

Accounting is defined as a collection of data in a systematic, structured, and valuable quantitative information expressed in currency units on the transactions. It is the art of recording the data then classify it and summarize in an important manner in the monetary terms and last interpret the results. Bookkeeping can be defined the recording of the transactions on a daily basis in an unsystematic way. Accounting is divided into different types: financial accounting, management accounting, tax accounting, environmental management accounting etc. Financial accounting can be defined as the collecting data, sorting it, and recording, adding together and reporting in monetary terms. It uses certain principles to record, classify, and summarize the data collected in monetary terms. The main function of financial accounting is to maintain the economic life history of a company: record the past figures that can use to make future decisions. The cost accounting is based on the data which is attained from the financial accounting procedures.

Regulations - Accounting and Financial Statements

Regulation is an administrative legislation which constitutes rights and assigns responsibilities. Accounts are regulated in order to provide financial information about the regulated business which can be used by the regulators, investors, consumers, industry and shareholders. The information provided by the regulated accounts are more wide and focused instead of the information contain in the statutory accounts. In this essay we will discuss the importance of the regulated accounts and how accounts are regulated in the UK.

Regulation on accounts play a significant role in the stock market due to mixed perceptions regarding investment decisions in publicly traded companies. This mixed perception is the capabilities of company to hide the financial distress which usually happen when company mislead the accounting policies. When accounting laws are implemented in any firm they lower this perception which forms a dilemma within the investors. Companies are subject to this legislation which will provide data that represents the accounting situation (following levels of analysis required) from the budget data through activities of reclassification and algorithms in accordance with GAAP (Petroni & Beasley, 1996, 151-171).

Moreover, when accounts are regulated under the accounting laws and policies than corporation and public organization will held responsible for their actions. Hence, when laws are strong, it will result in saving the public investment against fraud. This will provide a benefit to the accounting firms in a way that they will not be accountable for the actions or any misstatement in their final financial statements. This will evade the fraudulent activities perform by the companies and this will give confidence to the accountant due to the strict consequences. The main purpose to regulate the accounts is to protect the investment of the public by giving them a clear financial position of the company. No matter whether the company is public or private, the focus is on the protection of the fund invested against the fraudulent activities. This has significant important and this is the reason why government has tended to regulate accounting practice and its law ...