Scribd
Upload
18 views

study material

Uploaded by

Alfred Go-od
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
18 views

study material

Uploaded by

Alfred Go-od
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 1

Financial accounting is a specific branch of accounting involving a process of recording, summarizing, and

reporting the myriad of transactions resulting from business operations over a period of time.

These transactions are summarized in the preparation of financial statements—including the balance
sheet, income statement, and cash flow statement—that record a company’s operating performance
over a specified period.

Work opportunities for a financial accountant can be found in both the public and private sectors. A
financial accountant’s duties may differ from those of an accountant who works for many clients
preparing their accounts, tax returns, and possibly auditing other companies.

Key Takeaways

 Financial accounting is the framework that dictates the rules, processes, and standards for
financial recordkeeping.

 Nonprofits, corporations, and small businesses use financial accountants to prepare their books
and records and generate their financial reports.

 Financial reporting occurs through the use of financial statements, such as the balance sheet,
income statement, statement of cash flow, and statement of changes in shareholder equity.

 Financial accounting differs from managerial accounting, as financial reporting is for reporting to
external parties, while managerial accounting is for internal strategic planning.

 Financial accounting may be performed under the accrual method (recording expenses for items
that have not yet been paid) or the cash method (only cash transactions are recorded).

You might also like