The Accounting Profession

The way accountants and the accounting profession are viewed has dramatically evolved. Before, accounting is deemed an old-foggy profession swarmed with hunched old men sitting in the corner with bunch and piles of paper. Now, this view is outdated. Accountants now are business professionals serving the role of contributing to the health of businesses. Choosing to be an accountant can be a smart choice because of the persistent demand in both public and private spheres.

What is accounting and what do accountants really do?

Put in layman’s language, accounting is keeping track of resources, be it be tangible or intangible. It is the process by which assets, liabilities, equity, income and expenses are monitored over a certain period of time. It is often referred to as the language and soul of business for the fact that it produces and keeps pertinent financial information a company has. This financial information is necessary for informed decision to the management, employees, regulatory bodies, potential investors and other stakeholders.

Accounting is also a body of rules, conventions and general standards established for uniformity in presentation and reporting of financial information to make them more relevant and informative. These norms and standards gain their authority from general acceptance of the accounting profession and the public. It is a function that gives financial information to operating segments and divisions of the company. Accounting entails capturing financial activities, summarize and interpret them for its various users.

Accountants are involved in different levels of management. From simple recording of transactions to preparation of financial statements and report, to business analysis and even to controllership, accounting professionals flock the corporate ladder. They participate in cost efficiency measures, consensus of mergers and acquisitions, total quality management, development of information systems and tax management.

Basically, there are four fields of accounting as follows:

1. Government accounting. This is mainly accounting of books and records of government instrumentalities including government owned and controlled corporations and financial institutions. Auditors examine records of government agencies for fair presentation and accuracy. They have to be satisfied that items of revenues and expenses are in consonance with existing laws and regulations. Since funds came from the public, they have to be content from accounting records that these funds are properly utilized.

2. Public accounting. This is a broad range of activities including bookkeeping, accounting, consulting, tax management, financial advisories and the like. Clients may be corporations, nonprofit organizations, churches, or individuals.

3. Management Accounting. Also referred to as cost, managerial or industrial accounting, it is designed primarily to records, summarize and report financial transactions of a specific organization. Accountants are part of the management with which they are responsible for budget preparation, performance evaluation and cost control and management. Management accountants are usually part of a team involved in strategic planning for the company.

4. Accounting in education. This field of accounting hones the technical foundation of accounting as it is found in the academe, in schools and universities. Accounting practitioners, usually Certified Public Accountants, teach students on accounting principles and concepts. Subjects taught include taxation, auditing, financial accounting, business broker sales, management services and information systems.