Definition of accounting
How do you define basic accounting , when we talk about such a vast business field?
How is accounting defined?
Economipedia: Definition of accounting
Accounting is the part of finance that studies the different items that reflect the economic and financial movements of a company or entity. It is a key tool to know in what situation and conditions a company is and, with this documentation, to be able to establish the necessary strategies in order to improve its economic performance. For example, if we buy wood to make chairs we will have to count that purchase to know how much we have, how much it has cost us, who is the seller, on what date we bought it, etc. Accounting is in charge of all that and more.
Debitor: Definition of accounting
Accounting is the discipline that allows to reflect the economic activity of a business. It is based on a set of standardized procedures. This set of rules is what is known as the Generally Accepted Accounting Principles or GAAP. The objective of accounting is to provide reliable information on the results of a company obtained in a given period of time. It also serves so that those who manage the business can make decisions based on this information.
Dictionary of the Royal Spanish Academy: Definition of accounting
System adopted to keep score and reason in public and private offices.
American Accounting Association
The accounting is the process of identifying, measuring and communicating economic information suitable to allow judgments and decisions documented users of such information. This definition of accounting was issued by the American Accounting Association in 1966 and after the years that have passed it continues to be adjusted point by point to the current reality of what is the accounting recording technique.
Financial Information Standards
The Financial Information Standards define Accounting as a technique used to record operations that economically affect an entity and that systematically and structurally produces financial information.
Paulino Aguayo Caballero
In the Book Basic Accounting, by Paulino Aguayo Caballero, he defines accounting as a body of knowledge, it is an empirical science, of an economic nature, whose objective is the description and prediction, qualitative and quantitative, of the state and economic evolution of a specific entity , carried out through methods of capture, measurement, assessment, representation and interpretation, in order to be able to communicate objective, relevant and valid information to its users for decision-making.
We could define the concept of accounting as that science or discipline in charge of the analysis and presentation, through accounting statements, of the financial information of a company, in order to be able to study, measure and analyze all its assets and determine in what state are your economy and finances.
All the economic and financial information of a company must be reflected truthfully in the financial statements; in this way, appropriate decision-making is allowed by shareholders, investors, creditors and / or business owners. Regardless of the size of a company, be it a sole proprietorship or a large multinational company, it is necessary to keep an accounting control of its financial situation. Through business accounting , we ensure the profitability of the company, in addition to having the obligation to face the Public Treasury.