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Scope of Accounting

Scope of Accounting

Accounting is a process of summarizing, analyzing and recording of business financial transaction. 
The scope of Accounting in today time are very high, in every field small to large business to 
maintain our monthly financial transaction recording and all financial activity managed by Accounting.

scope-of-accountingIts use is not limited to the business world alone, but it has spread to all areas of the society and all 
businesses. Nowadays, in any social institution or professional activity, whether it is earning or not,
financial transactions should be there.
Therefore, when they are there, these transactions are required to be recorded and summarized 
and after the definite fixed period ends, it is necessary to find a net result. Apart from this, the
appropriate persons also need the interpretation and communication of those information. Only 
accounting usage can help overcome these problems.
In the modern world, accounting systems are implemented not only in all commercial organizations,
but also in many non-commercial organizations like schools, colleges, hospitals, cooperatives, 
as well as government.
Professional person like practitioners, lawyers, chartered accountants, etc. also adopt some suitable 
type of accounting methods. In fact, accounting methods are used by all the people involved in a 
series of financial transactions.

As the scope of accounting has changed many times in the recent days. Since accounting is a
dynamic subject, its scope and operation area are always growing to maintain momentum with 
changes in socio-economic changes. As a result of continued research in this field new areas of
application of accounting principles and policies have emerged.
Examples of new areas of application of national accounting, human resources accounting and  
social accounting systems are examples.

Nature and scope of accounting:

Accounting is known as a record of financial transactions and presentation of relevant information
of the appropriate person. The basic functions of accounting are as follows.


Accounting is a process:

A process refers to the method of objecting or doing a specific job step by step according to the 
goal. Accounting is identified as a process because it does a special job of collecting, processing 
and communicating financial information. In doing so, it follow  to certain steps like data recording
classification condensation, consolidation and reporting of collection.

Accounting is an art:

Accounting is the art of recording, classifying, summarizing and finalizing financial data. The 
word 'art' is the way to do something. It is a creative knowledge that includes some creativity 
and skills that can help us achieve certain objectives. Accounting is a systematic method in
which the skills and expertise required for certain techniques and its appropriate application
are required. So, nature and scope of accounting is an art.

Accounting means and not the end:

Accounting results in financial results and the status of an entity, and also, it transmits this
information to its users. Then users make their decisions on the basis of such information. 
Therefore, it can be said that keeping only the accounts can be the primary purpose of any
person or entity.
On the other hand, the main objective can be defined by making decisions on the basis of the 
financial information provided by the bookkeeping. Hence, bookkeeping itself is not a goal, but 
it helps to achieve a certain goal. So it is said that accounting is "a way to end" and it is not "a
goal in itself".

Accounting is related to financial information and transactions;

Accounting records the date after classifying the financial transaction and date and finalizes
its results for a certain period of time to deliver messages to its users. So, by the end, in each 
step, accounting deals with financial information. Only financial information is the subject. It does
not deal with non-monetary information of non-financial aspect.

Accounting is an information system:

Accounting is recognized as a repository of information and specialty. As a service function, it 
collects processes and transmits the financial information of any unit. This discipline of knowledge
has been developed to meet the need for financial information required by different interest groups.

In above the Accounting courses in Chandigarh give the detail of Scope of Accounting is widely
applicable in every private to government sector. They all information of accounting are shown 
the importance of accounting in every field.


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