Accounting focuses on controlling and managing the Financial aspect of a Business.
It is a very important part to ensure the smooth operation and development of a Business.
The accounting process is divided into three sectors.
Three Sectors of Accounting Process
- Recording Day to Day Transactions (Book Keeping)
Any event that involves money or moneys worth will have to be recorded on a daily basis.
- Classifying and Summarizing
The day to day transactions will then be summarized into Financial Statements, which can be prepared every month in and at every year end.
- Communicating Information to Users
The Financial Statements will now be used by the owner as well as the other parties to make important business decisions and also to take any corrections.