Section 1| SECTION OBJECTIVES | | 1. | Define accounting.
WHY IT’S IMPORTANT
Business transactions affect many aspects of our lives. | | 2. | Identify and discuss career opportunities in accounting.
WHY IT’S IMPORTANT
There’s something for everyone in the field of accounting. Accounting professionals are found in every workplace from public accounting firms to government agencies, from corporations to nonprofit organizations. | | 3. | Identify the users of financial information.
WHY IT’S IMPORTANT
A wide variety of individuals and businesses depend on financial information to make decisions. |
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| TERMS TO LEARN | | AccountingThe process by which financial information about a business is recorded, classified, summarized, interpreted, and communicated to owners, managers, and other interested parties | | Accounting systemA process designed to accumulate, classify, and summarize financial data | | AuditingThe review of financial statements to assess their fairness and adherence to generally accepted accounting principles | | Certified public accountant (CPA)An independent accountant who provides accounting services to the public for a fee | | Financial statementsPeriodic reports of a firm’s financial position or operating results | | Governmental accountingAccounting work performed for a federal, state, or local governmental unit | | Management advisory servicesServices designed to help clients improve their information systems or their business performance | | Managerial accountingAccounting work carried on by an accountant employed by a single business in industry | | Public accountantsMembers of firms that perform accounting services for other companies | | Tax accountingA service that involves tax compliance and tax planning |
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Accounting provides financial information about a business or a nonprofit organization. Owners, managers, investors, and other interested parties need financial information in order to make decisions. Because accounting is used to communicate financial information, it is often called the “language of business.” |
