Important Role of Accounting

Accounting on accountants nottingham can also be said to be a reflection of the company. Because accounting is used in all companies, both private and government, it is important to study accounting. The company is a business entity that carries out business activities with the aim of obtaining the maximum profit or profit. So accounting is the company’s main business language to be able to take part in the world of economics. Service, trading, and manufacturing companies carry out financial transactions, which in turn use accounting to record and process these transactions. The recording and processing activities are not arbitrary or arbitrary but based on existing and valid proof of transactions. Evidence of these transactions can be in the form of sales notes, purchase invoices, receipts, sales returns, purchase returns, and so on.

Accounting has a very important role in economic activity, namely as follows:

As a measure of the progress of the company. From a well-structured, neat, and correct accounting process in accordance with existing transaction evidence, the company can be categorized as a good company. Vice versa.
As an information system that produces financial reports and is useful for interested parties regarding the condition and economic activities of the company. This function as previously described above.
In relation to the nation’s economic activities, the tax of a company that must be fulfilled by the state can also be calculated using accounting.
As a material for consideration for domestic and foreign investors who wish to invest in a company.
As a tool to detect and prevent corruption or misuse of funds in a private or government company.
Apart from its role in facilitating aggregate economic activity, accounting also has more specific benefits for each company.

The benefits of accounting include the following:

For Planning, Coordination, Supervision, and Control
The first benefit of accounting is that the manager as an internal party that is directly related to the company needs financial information that is presented through an accounting process for planning, coordination, supervision, and controlling the condition and finances of the company.

Planning and Establishing Company Activities
The financial statements present data on the company’s cash and non-cash assets. For operational purposes, the company requires such data to be valid and accurate about the company’s liquidity conditions. So that it can be clearly planned whether the company is able to make purchases, pay debts, and allocate other economic resources.