Accountancy


Accounting is considered a discipline that is in search of the measurement, registration and interpretation of the capital of a private or public organization. Accounting is based on various methods, such as the quantification of capital and the ordering of all accounting information that helps facilitate decision-making, through the financial statements that arise from accounting. This discipline, in turn, has a fairly broad scope according to its fields, including finance, auditing and management accounting.

what is accounting

As mentioned before, accounting is a discipline through which various accounts, records and measurements of the capital of a specific institution are carried out. If it is seen from a generic point of view, there is not a business that does not contemplate, even in its beginnings, accounting; This is due to the fact that no matter when or where, they will always have to calculate the capital invested, received and the next one to be invested. Even when it comes to informal commerce, accounting must be carried out to maintain control of the products offered to the public.

The word accounting refers directly to the person who performs this management, which is called an accountant. On the other hand, this discipline could also be easily defined as the space or office where the accounts and data of a certain entity, whether public or private, are carried out.

Regarding the latter, generally when referring to public accounting, many come to think that this profession can only be exercised in organizations and institutions related to the State, however, the reality is that the accountant can exercise his functions in all kinds of Business.

the public accountant

To understand what public accounting is, as it is also known in the practical area, it is necessary to be clear about who are the people who practice such a profession and how they carry it out in daily life. In the first place, the person in charge of carrying out this management is a public accountant, who after studying at the accounting and administration faculty, obtains his degree in accounting and proceeds to exercise his profession through private or public management. The public accountant has the ability to interpret the financial statements of a certain organization, company or entity.

It is also capable of registering all financial transactions, establishing and maintaining business credit relationships and preparing all types of capital investment projects.

Management, in terms of contributions by the entity in which the accountant works, is also part of his primary functions, as well as carrying out audit projects and tax issues. The management of this professional is very broad and, like any discipline, extremely important not only for companies and non-profit entities, but also for those of private origin.

accounting types

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Like any discipline, there are a number of elements or branches that go hand in hand to give accounting a broader meaning. Both bookkeeping and bookkeeping have functions that encompass many elements, but when it comes to business, the situation becomes even more complex than you think.

Each entity is endowed with a series of departments, processes and, most importantly, the staff. Precisely for this reason, it is divided into three types to be taken into consideration: Accounting according to its origin, its business management and the information it can handle.

According to its origin

This aspect is subdivided into a classification of two more elements, which are public accounting and private accounting.

Public accounting

Here we are facing a registration and structure function of all the operations, projects and planning carried out by companies, organizations, entities or public bodies, always from an accounting point of view. With audiences, reference is made to the fact that their actions are directly aligned with the wishes of the State, government or leaders of a country itself.

private accounting

This consists of the control of projects, operations and activities carried out by individuals.

According to your activity

Here we talk about the operations carried out by the company and as in the previous point, it has an even broader classification and 4 aspects that must be fully explained.

industry accounting

Industrial accounting presents an approach which is aimed at those institutions that work with raw material and manage to transform it into certain products, that is, into more elaborate ones under their control, observation and responsibility.

business accounting

Commercial accounting is based on the total control of income, expenses, investments, generic capital and all the economic production of said company. In this way, the institution not only fulfills its main task, which is to sell or buy, but also has a discipline in charge to have everything in perfect order.

Accounting for extractive companies

It focuses solely and exclusively on those institutions whose objective is the exploitation of the natural resources of a specific country or territory. For example, oil extraction companies.

Service Accounting

Service accounting, as its name indicates, is responsible for regulating the institutions that provide basic services, be it water, electricity, gas, etc.

According to the information

According to the information that entities and organizations handle, accounting is subdivided into 5 more aspects and in fact they are the most famous in this discipline.

financial Accounting

It is intended directly for the company’s managers and partners because its focus is directed at economic and financial activity, as its name implies.

Administrative accounting

This is based on the public administration and management of the company in question.

Tax Accounting

This kind of accounting is basically related to the declaration and payment of tax on public finances.

Cost accounting

Its approach is aimed at industrial companies because there it is imperative to perform data analysis, production costs at the unit level, the production process carried out in said company and, most importantly, sales.

management accounting

This is in charge of processing both the costs and the economic and financial activity of the company in order to make decision-making possible. The information they offer is extensive and has the ability to provide solutions in short periods of time.

Accounting degree

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The accounting curriculum is as broad as its profession, many fear it for the simple fact of seeing other somewhat complicated disciplines, for example, mathematics, law, administration and even economics, but it is thanks to them that you can have different career approaches and obtain the necessary information when practicing the profession. Accounting is not an easy career, but that doesn’t mean it’s impossible. There are a series of subjects that mark the correct path so that the future accountant knows how to defend himself in the professional area and have his own criteria.

What are the subjects that an accounting student sees

In itself, the subjects vary as the semesters pass, however, there are a series of subjects that are essential for the student to collect information and that, in addition, will be useful before, during and after completing the degree. These subjects are accounting, commercial, labor, constitutional, civil, finance, economics, administration, computer science (both basic and intensive), taxes, costs, auditing, total quality, professional ethics, permanent tax updating, etc. All these subjects and others that are optional, are what make up this broad career.

How many years have you studied accounting?

This depends on the university and the region in which the career is studied. But in generic examples, the bachelor’s degree can be completed in around 4 to 5 years, the semesters are divided between 8 and 10 according to the curriculum and the capabilities or benefits of the academic institution. There are also universities that offer a degree as accounting technicians and this only takes two years of study.

Difference Between Bookkeeping and Accounting

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Although many people tend to say that accounting and bookkeeping are identical disciplines, the opposite is actually the case. Accounting is a branch of accounting and is responsible for making economic records in certain areas.

Unlike accounting, to practice accounting it is not necessary to go through a study plan and apply to a university to obtain a degree, that is, any person, with knowledge learned through the trade, can practice accounting. Accounting is broad, a degree is needed to exercise it and it has a series of branches that solidify its management.

The branches of accounting make this discipline differ from accounting precisely because of the scope and focus they have. For example, one of the branches, as previously mentioned, is accounting, but in addition, there are others that give life to this discipline and have a strong role in it. Costs are one of them, which focus on generating all kinds of information that allows the transformation of the raw material into a product itself. Costs are also part of accounting classification based on your information.

On the other hand, there is the fiscal branch and it is in charge of taxes, public finances and everything related to their calculation so that they can be paid soon in the stipulated time and without any setbacks.

There is also the branch of companies, this regulates in an accounting manner the individuals who interfere or who have an interest in the organizations of companies, institutions or entities. The audit has a special function within the classification of this discipline and is to observe the activities carried out by the rest of the branches, check that everything is in order and that they work properly.

Finally, there is administrative accounting and this is a branch with managerial approaches. Each of these branches make life within accounting and, although some also participate in accounting, they also make both disciplines differ significantly. Accounting is a discipline worth studying, embracing and, most importantly, practicing.

Frequently Asked Questions about Accounting

What does accounting do?

It is in charge of registering, measuring and interpreting the capital of a public-private entity whose fundamentals are related to the quantification and ordering of both the capital and all the accounting information of that entity or organization.

Is it difficult to study accounting?

Many people fear studying this career because it is not only about accounting, but about other essential branches, including mathematics, economics, administration and law. All these subjects can become complicated, but with dedication and perseverance, the accounting career becomes enjoyable.

What does an accounting graduate do?

Interprets the financial statements of a company, entity or body, both public and private, as well as registering the financial transactions of the body, making credit relationships and carrying out any type of accounting or capital investment project.

What sectors does accounting serve?

Accounting applies to both the public and private sectors.

What other careers is accounting related to?

With the career of law, administration, economy, with commerce, business relations, etc.