The accounting basics include an overview of accounting. Accounting is a profession in which trained accountants gather financial information about a company or individual and report this information in a summarized format that can be understood. Accountants must be certain to capture all financial events or possible events that have an effect on finances.
Usually, before an individual becomes an accountant, he must go to college and acquire a bachelor degree. From that point, many go on to work for a CPA firm and then take a CPA exam to become a Certified Public Accountant. Other accountants work for businesses as cost accountants, payroll and accounts payable clerks, financial advisors, etc. There are many different types of accountants and job descriptions.
In a four year degree program, an accountant will learn what accounting is, the principles of accounting, how to use accrual accounting, cash basis accounting, accounting formulas, accounting terms, internal controls, as well as learn about accounting history and ethics.
Accounting is used by:
Can you imagine a bank making a loan to a business without knowing what their revenue and expenses are? Would you invest thousands of dollars in company stock if you didn't understand their financial position?
While there have been scandals such as Enron that have involved misleading accounting, the system we have is continually improving and evolving.