What is financial accounting & why is it important?

Financial accounting involves the preparation of accurate financial statements. The focus of financial accounting is to measure the performance of a business as accurately as possible. While financial statements are for external use, they may also be for internal management use to help make decisions.

What is the role of an accountant?

The role of an accountant is to responsibly report and interpret financial records. Small businesses may hire only one accountant. Large companies may employ an entire accounting department. The accounting profession covers a broad range of roles, including bookkeeping, tax planning, and audit.

What is the main purpose of accounting?

The core purpose of accounting is to help a business track and manage all of its transactions, including expenses and incomes. Accountants also track items like outstanding invoices or payments and owed debts, so business executives can better understand the company's overall financial position and make better decisions about resource allocation.