The importance of data for accounting and parties interested in accounting information

May 22, 2018 | By admin4u | Filed in: Uncategorized.

The term "data" means primary details or numeric facts about the event or transaction. Data is stored and maintained on a computer or network. Computer software, such as HiTech Financial Accounting, processes this electronic data. Data is retained on paper or on paper. As accounting is limited to financial transactions and events only, accounting data consists of financial facts that relate to the business's business and events in the accounting period. In addition, the accounting data must be supported by documented evidence. Thus, documents known as vouchers support the data. Data is usually unordered and can be separated in raw form. You can not understand. Thus, in accounting processes, raw data is made to make the information ready to be useful and meaningful, which can be used by different users of accounting information when deciding

. Thus, the accounting cycle processed by accounting data is accounting information. Collect, record, categorize, group, evaluate, chart, layout, and summarize data to use the same information for users to make decisions.

Accounting Data It consists of financial transactions and events relating to an entity for the accounting period that are supported by documentary evidence (vouchers). For example, receipts and payments are credited to the beneficiary's receipt by invoicing, sales on external accounts, and credit back to the creditor; settles the collection order; bills or pay rolls, etc.

Thus, the first and most important task of accounting is to collect data supported by vouchers to ensure its authenticity. Accounting processes are recorded in the books of the original entry (journals or journals); (placement of transactions of the same type in one invoice) (end-of-year valuation by settlement or valuation) preparation of tables (accounting and arithmetical accuracy checking) and preparation of financial statements and income statement, balance sheet) for information purposes

The daily computing accounting software can handle this task very quickly in a short time. Accounting information is most often presented in the form of financial statements, such as the profit and loss account (trading and income statement) positions (balance sheet). Now-a-day statement on changes in the financial situation; value-added statement; report on human resources accounting; Social Performance Report etc. It is part of the accounting information

Difference between data and information

Data

1. It refers to all details and facts.

2. Generally abnormal and dissociated.

3. Raw form, and accounting contribution.

4. Users can not understand or use it.

It does not depend on the information.

Information

1. Only mention the events that are related to the entity.

2. Properly organized, qualified and organized.

3. Ready and Accounting Output

4. Users of accounting information understand and use to make their decisions.

5.

Parties interested in accounting information

Accounting information is of interest to people directly or indirectly affected by an enterprise

Management: [19659002] A small business in general the sole trader or partners are engaged. But a big business is usually done by an affiliate company that separates the management from ownership. Managers are responsible for effectively running business and maximizing the return on capital without endangering the fund.

Management needs accounting information in the selection of

(1) alternative proposals

(2) (19659002) (4) performance appraisal and

(5) corrective measures to restore discrepancies in actual results [19659002] Owners:

Although owners initiate a contribution to the business, the latter will receive their claim to return on their investment. This is true not only for repayment, but for capital injection. Having completed the charges, including employee salaries and the lender's interest income, if any of them may be distributed as a reward for capital. Of course, the owners are also interested in the security of their capital, just as for a reasonable return on the stability and well-being of the problem. Accounting reports (annual) not only evaluate past performance but also help the entity's future prospects. Such information is very important to the owners as well.

Creditors:

May be a short-term supplier of goods, a temporary or long-term lender. mortgage loans, policy holders, etc. While both are interested in the stability and income of the debtor company, however, the former strives for its short-term liquidity, while the latter is interested in long-term solvency

. :

Many daily products are subject to excise duty and sales obligations. The government regulates basic products such as medicines, vegetables, oil, and so on. It's also cool. So the government is concerned about the costs of handling excise duties and regulating the prices of products. The government is also interested in accounting information on income tax purposes.

Employees:

Continuous employment and business stability are associated. Again, trade unions are interested in sharing the profits of the company in the form of bonuses. For this reason, employees are of course interested in accounting information provided by annual accounting reports

Consumers:

Almost all quarters of the price increase are lagging behind. Accordingly, the producer seeks to reduce the cost of the product and its selling price. Recently consumer associations have been established that exercise business and industry governance and social responsibility towards society. Thus, consumers need accounting information

Researchers:

Financial Statements that evaluate business issues as a valuator in the light of business conditions. These statements therefore attach great importance to the theory of accounting as well as to business scientists carrying out research in business and practice

Nature of business income

One of the main purposes of financial accounting is to examine whether profitable business is or not. Accounting allows us to know whether or not the company has gained or suffered losses during the reporting period

Source by Anil Kumar Gupta


Leave a Reply

Your email address will not be published. Required fields are marked *