The internal and external need of the business is constantly changing and so is the accounting system that is being used (Shanker, n. d. ).
There are specific characteristics in the internal accounting system that is required to reach different objectives and ease the workload of accounting employees. The short and long term objectives consists of producing and writing annual financial reports using the data received or collected in an annual fiscal report. Usability in the internal accounting system makes it easier to reach short and long term accounting objectives.
This also makes the operational task easier to use which includes updating income statements and amounts, tracking the company’s purchase, and using the system to calculate discounts or taxes the company needs throughout the fiscal period (Jane, 2012).
In order for the system to work it has to be easy to use in case new employees need to be trained. The internal accountant will have access to the system and be able to control the cash-flow of the business to prevent and handle any situations of fraud, internal theft, and changes to the budget to match financial plans.
He or she having access to the system is important in case managers misuse the system or make bad decisions. The data is used to make better financial decisions for the company and prepare financial proposals for the company projects according to Jane, (2012).
The purpose of the internal accounting system is to help the company achieve its objectives by providing accurate and organized financial data. This information is important because the reports used in budgeting and planning will help to create and compare figures that show revenues and expenses.
The Essay on Accounting Data Business Company Financial
What is the role of accounting and financial decision making in Business? Why is essential to consider accounting data in relation to other factors in other decisions in all situations. The word ACCOUNTING can firstly be defined as the collection, recording, compiling and forecasting of financial information. There are two different strands in accounting, and these are FINANCIAL accounting and ...
This will allow the company to make better decisions about purchasing machines without getting in debt. The internal accounting system unifies data, organize and establish a structure where information is easy to find. Ethics in accounting is very important. It provides the code of ethics and conduct that accountants must follow. The principles of ethics are based on honesty, fairness, objectivity, and responsibility (Vitez, n. d. ) and should be used when using accounting services for the company and public.
