ACCURATE ACCOUNTS

Importance of Accurate Accounts for Business Interest

Importance of Accurate Accounts for Business Interest

Introduction

The main purpose of accounting is to provide users with useful information for decision-making. The financial information does not constitute a trade secret of the enterprise; it is open to publication and, as a rule, certified by an independent auditing organization. All these factors lead to strict regulation of the structure and composition of external reporting company rules and principles which it is made. Maintain financial records in accordance with international accounting standards for companies and firms become mandatory, and their principles have requirements particular to the financial accounting system.

Discussion

Importance of Accurate Record Keeping

The cornerstone of the financial analysis is provided in the information provided by financial statements of the company, taking into account the characteristics of users who are targeted and specific objectives that gave rise, among the most known and used are the Balance Sheet and the income statement (also called Profit and Loss), which are prepared, usually at the end of the period of operations managers and which to assess the entity's ability to generate positive flows according to the data collection accounting resulting from economic facts.

There are other statements that are sometimes not taken into account and provide useful and important information on the operation of the company, among these are: the state of Changes in Equity, the Change in Financial Position and the Cash Flows. As for the internal accounting system, it is the prerogative of the leaders of the creation of the company and should not be regulated by the state. Domestic production accounting information provides a solution to the internal management problems through prompt, timely and reliable information on the costs and benefits for the whole company and its individual parts. It is most often prevails control and cost management of deviations from planned. The implementation of management by exception allows the registration of positive deviations from the index or eliminates the negative by analyzing the causes and to make informed and timely decisions. In the system of management accounting, this is achieved through the effective use of operational information through the centers of financial responsibility and cost centers based on the effective management of data analysis of cost accounting.

Allocation of financial responsibility centers can significantly improve the efficiency of the production control, accounting and management. In terms of powers and responsibilities of their leaders - a cost center, sales, revenue, profits, capital expenditures, investments, and control. On the tasks and functions of the centers of financial responsibility is usually regarded as the main and service (Fig. 1). For each responsibility center should be identified goals and objectives, including the accounting that is, what information, how often, where and by whom should be provided. The work here should be directed to the search for necessary information and ensure its decision-makers, when they need it, and in a manner which makes it suitable for practical use. Allocation of financial responsibility centers requires a mechanism for the allocation of ...