Form Assignment Accounting With Solutions In Wayne
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1.1 INTRODUCTION Accounting is a system meant for measuring business activities, processing of information into reports and making the findings available to decision-makers. The documents, which communicate these findings about the performance of an organisation in monetary terms, are called financial statements.
Financial accounting is a method by which a company records and reports revenue, expenses, and income for a specific period. We follow strict guidelines to ensure that our financial statements are accurate and comply with statutory, financial, legal and regulatory requirements.
While financial accounting is concerned with historical data, managerial accounting focuses more on future planning and forecasting. Another key difference is that accounting follows specific standards like GAAP, whereas managerial accounting is more flexible.
Financial accounting records the transactions which have already taken place during an accounting year and are recorded in chronological order. Hence, financial accounting focuses on the past rather than the future.
The information created through financial accounting is entirely historical. A financial statement contains data for a defined period of time. Managerial accounting looks at past performance but also creates business forecasts. Business decisions are informed by this type of accounting.