ABM - FABM11 IIIa 5

BRANCHES OF ACCOUNTING
1. Financial accounting
is a specialized branch of accounting that keeps track of a company's financial transactions.
Using standardized guidelines, the transactions are recorded, summarized, and presented in
a financial report or financial statement such as an income statement or a balance sheet.
Companies issue financial statements on a routine schedule. The statements are

considered external because they are given to people outside of the company, with the
primary recipients being owners/stockholders, as well as certain lenders. If a corporation's
stock is publicly traded, however, its financial statements (and other financial reportings) tend
to be widely circulated, and information will likely reach secondary recipients such as
competitors, customers, employees, labor organizations, and investment analysts.
It's important to point out that the purpose of financial accounting is not to report the value of
a company. Rather, its purpose is to provide enough information for others to assess the
value of a company for themselves.
2. Management accounting-
The process of preparing management reports and accounts that provide accurate and
timely financial and statistical information required by managers to make day-to-day and
short-term decisions.
Unlike financial accounting, which produces annual reports mainly for external stakeholders,
management accounting generates monthly or weekly reports for an organization's internal
audiences such as department managers and the chief executive officer. These reports
typically show the amount of available cash, sales revenue generated, amount of orders in
hand, state of accounts payable and accounts receivable, outstanding debts, raw material
and inventory, and may also include trend charts, variance analysis, and other statistics.
3. Government accounting
refers to the field of accounting that specifically finds application in the public sector or
government. A special field of accounting exists because:- - The objectives to which
accounting reports to differ significantly from that for which generally accepted accounting
practice has been developed for in the private (business) sector; & - The usage of the results
of accounting processes of government differs significantly from the use thereof in the private
sector.
4. Auditing
-Systematic examination and verification of a firm's books of account, transaction records, other
relevant documents, and physical inspection of inventory by qualified accountants (called auditors).
- the examination of the financial report of an organisation - as presented in the annual
report - by someone independent of that organisation. The financial report includes a
balance sheet, an income statement, a statement of changes in equity, a cash flow
statement, and notes comprising a summary of significant accounting policies and
other explanatory notes.
The purpose of an audit is to form a view on whether the information presented in the
financial report, taken as a whole, reflects the financial position of the organisation at a
given date, for example:
 Are details of what is owned and what the organisation owes properly recorded in the
balance sheet?
 Are profits or losses properly assessed?
When examining the financial report, auditors must follow auditing standards which are
set by a government body. Once auditors have completed their work, they write an
audit report, explaining what they have done and giving an opinion drawn from their
work. With some exceptions, all organisations subject to the Corporations Act must
have an audit each year. Other organisations may require or request an audit
depending on their structure and ownership or for a special purpose.
5.Tax accounting
is the accounting process that focuses on tax issues - including
filing tax returns and planning for future tax responsibilities - as
opposed to the preparation of financial statements.
Important to consider
Tax law varies immensly from country to country, as well as between

different regions and even cities. Therefore it is important to consider
having your accountant prepare or oversee your tax accounting
records.
6. Cost accounting
A method of accounting in which all costs incurred in carrying out an activity or accomplishing a
purpose are collected, classified, and recorded. This data is then summarized and analyzed to arrive
at a selling price, or to determine where savings are possible.
In contrast to financial accounting (which considers money as the measure of economic
performance) cost accounting considers money as the economic factor of production.
Cost accounting involves the techniques for:
1. determining the costs of products, processes, projects, etc. in order to report the correct amounts on
the financial statements, and
2. assisting management in making decisions and in the planning and control of an organization.
7. Accounting Education
means that education which teaches recording and maintaining books of accounts . This
education came in existence after mathematics and Economics science . In the point of
facts , if It should be said that above education is the base of accounting education . Above
Education are very helpful for getting accounting Education .
In accounting education , we learn what is way of recording our different transactions. With
this education , we can calculate our business's result relating to different transactions and
events . It is not easy to find to reward or return on investment made by businessman .
Suppose , A company whose sale is 6 Billion $ ( 6 X 1000000000000 $ ) and it has spread in

120 countries and if you are said to calculate the profit or loss of a company . Then , you will
feel giddy . But ,if you learn accounting education , you will feel reposal and easement to
calculate above profit or loss .
This accounting education is also helpful for determination of tax because , if we learn to
record all transactions in the books and on this base we can calculate correct value of tax
and become responsible businessman of this nation . All tax officers or assessing officers
confess the accounts of professional accountants who are expert in accounting education .
Success of business is fully under accounting's thumb . It is impossible to develop business
without accounting data and effective use of them for business plannings . For analysis of
different statement is also depend on cost and management accounting which are
subbranches of accounting .
One of magistral feature of accounting is that this education is encumbrance on brain . All
work is done in this education with fully scientific method of accounting .
After spending of time , all other educations forget but accounting education is always young
and challenging position in the brain of accountant . Accountant does their work with new
power . It is the reason that as accountant's experience increases , by the way amounts to
higher posts of administration .
It is true that getting of any education is no so simple and you have to face several difficulties
. Like other education accounting education is not so easy . It is the way of complexities and
Complications but student should do hard practice and try to understand accounting
terminology . After this student can solve every problem of accounting .
In end , I advise you to study continuously for becoming perfect in accounting education .
8. Accounting research
Accounting research is research on the effects of economic events on the process of accounting,
and the effects of reported information on economic events. It encompasses a broad range of
research areas including financial accounting, management accounting, auditing and taxation.[1]
Academic accounting research "addresses all aspects of the accounting profession" using
the scientific method, while research by practicing accountants focuses on solving problems for a
client or group of clients.[2] Academic accounting research can make significant contribution to
accounting practice,[2][3] although changes in accounting education and the accounting academia in
recent decades has led to a divide between academia and practice in accounting.[4]

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BRANCHES OF ACCOUNTING

Companies issue financial statements on a routine schedule. The statements are

 Are profits or losses properly assessed?

Tax law varies immensly from country to country, as well as between

Cost accounting involves the techniques for:

Suppose , A company whose sale is 6 Billion $ ( 6 X 1000000000000 $ ) and it has spread in

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