ACCOUNTING &

ROLE OF ACCOUNTANT

CONTENTS
Meaning of accounting and accountant
Accounting cycle
Importance of accounting
Types of accounting
Role of accountant
Limitations of accounting

MEANING OF ACCOUNTING

Accounting is theart of
Recording,
Classifying,
Summarizing
in terms of money,
transactions and events
which are of financial character,
and interpreting the results thereof
-The American Institute of Certified
PublicAccountants(AICPA)

ACCOUNTING CYCLE

ACCOUNTANT MEANING
A person who performs accounting functions

IMPORTANCE OF ACCOUNTING

Replaces memory
Maintains systematic records
Ascertains the operational profit or loss
Ascertain the financial position of business
Assistance in the Event of Insolvency.
Evidence in Court.
Facilitates Loans.
Facilitates Settlement of Tax Liabilities.
Facilitates Comparative Study.

TYPES OF ACCOUNTING

Financial
Managerial
Governmental
Tax
Forensic

FINANCIAL ACCOUNTING
Financial accounting is the field ofaccounting
concerned with the summary, analysis and
reporting offinancialtransactions pertaining to
a business.
This involves the preparation
offinancialstatements available for public
consumption

MANAGERIAL ACCOUNTING
Managerial accountingis the process of
identifying, measuring, analyzing,
interpreting and communicating information
for the pursuit of an organization's goals.
This branch ofaccountingis also known as
CostAccounting or Management
Accounting.

GOVERNMENTAL ACCOUNTING
Government accounting is the process of
recording, classifying, summarizing financial
information about government in aggregate
and in detail reflecting transactions and
other economic events involving the receipt,
spending, transfer, usability and disposition
of assets and liabilities.

TAX ACCOUNTING
Tax accounting consists ofaccounting
methods that focus on taxes rather than the
appearance of public financial statements.
Tax accountingis governed by the Tax
Accounting Standards(TAS)which dictates
the specific rules that companies and
individuals must follow when preparing
theirtax returns.

FORENSIC ACCOUNTING
Forensic accounting utilizes accounting,
auditing and investigative skills to conduct
an examination into a company'sfinancial
statements.
Forensic accountants are trained to look
beyond the numbers and deal with the
business reality of a situation. They are
frequently used in fraud cases.

ROLE OF AN ACCOUNTANT
Tax
Consultant

Auditor

Financial Report
Preparation

Analysis
And Advice

Compliance
Officer

AUDITOR
Statutory Auditor / External Auditor
All listed and public companies whose share capital is 10
crores or more
All private companies whose share capital is 20 crores or
more
Or any company having borrowings of 50 crores or more
* A "statutory audit" is a legally required to review the
accuracy of a company's or government's financial records.

Internal Auditor
He concerned with evaluating and improving the
effectiveness of risk management, control and
governance processes in an organisation.

OTHER ROLES

Liquidator
Share Valuation
Work
Investment
Counselor