Difference between revisions of "Accounts"
From TrueERP wiki
Omer Farooq (Talk | contribs) |
Omer Farooq (Talk | contribs) (→Overview) |
||
| Line 29: | Line 29: | ||
== '''Overview''' == | == '''Overview''' == | ||
| − | '''Accounting | + | '''Accounting is a systematic process of identifying, recording, measuring, classifying, verifying, summarizing, interpreting and communicating financial information.''' |
| − | + | ||
| − | + | ||
| − | + | ||
| − | + | ||
The key words in the above definition: | The key words in the above definition: | ||
Latest revision as of 17:38, 18 January 2016
Overview
Accounting is a systematic process of identifying, recording, measuring, classifying, verifying, summarizing, interpreting and communicating financial information.
The key words in the above definition: Accounting is about providing information to others. Accounting information is economic information - it relates to the financial or economic activities of the business or organization.
Accounting information needs to be identified and measured. This is done by way of a "set of accounts", based on a system of accounting known as double-entry bookkeeping. The accounting system identifies and records "accounting transactions".
The "measurement" of accounting information is not a straight-forward process. it involves making judgements about the value of assets owned by a business or liabilities owed by a business. it is also about accurately measuring how much Profit or loss has been made by a business in a particular period. The measurement of accounting information often requires subjective judgement to come to a conclusion.
The definition identifies the need for accounting information to be communicated. The way in which this communication is achieved may vary. There are several forms of accounting communication (e.g. annual report and Accounts, management accounting reports) each of which serve a slightly different purpose. The communication need is about understanding who needs the accounting information, and what they need to know.
In addition, Accounting is the systematic and comprehensive recording of financial transactions pertaining to a business. It also refers to the process of summarizing, analyzing and reporting transactions.
Financial Statements
It is a formal record of the financial activities of a business, person, or other entity. Accounting information is communicated using "financial statements". There are two main purposes of financial statements:
To report on the financial position of an entity (e.g. a business, an organization). To show how the entity has performed (financially) over a particular period of time (an "accounting period").
The most common measurement of "performance" is profit. It is important to understand that financial statements can be historical, or relate to the future. Accountability
Accounting is about Accountability
Most organizations are externally accountable in some way for their actions and activities. They will produce reports on their activities that will reflect their objectives and the people to whom they are accountable. Chart of Accounts
Complete list of accounts as required for any business. This list can be added to or deleted from depending on your particular requirements. In addition you can start from scratch with your own set of accounts or simply merge together a combination of both.
Chart of Accounts can viewed in a number of ways (Tree mode or List Mode)
From Main Screen - Select Accounts Module Select Accounts List Tab
Can view on standard List Mode searching is more easy. While you can also view on Tree Mode on the upper right side tick box Tree Mode. Options of tree mode can contract and expand on accounts.
Easy steps to follow on setting up Tree Mode on Default :
Select Utilities Module ? Select Preferences ? Choose Accounts ? Tick box on Default to Tree View for Chart of Accounts List Click Save and view your Chart of Accounts.
