introduction to accounting

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Presentation Transcript

Financial & Managerial Accounting : 

Financial & Managerial Accounting The Basis for Business Decisions

Slide 2: 

ACCOUNTING:Information for Decision Making Chapter1

Slide 3: 

Accounting information The accounting process Decision makers Economic activities Actions (decisions) Accounting “links” decision makers with economic activities ¾ and with the results of their decisions.

Types of Accounting Information : 

Types of Accounting Information Financial Managerial Tax

Slide 5: 

Information Users Investors Creditors Managers Owners Customers Employees Regulatory agencies -SEC -IRS -EPA Decision Support CVP analysis Performance evaluation Incremental analysis Budgeting Capital allocation Earnings per share Ratio analysis Information System

Basic Functions of an Accounting System : 

Basic Functions of an Accounting System Interpret and record business transactions.

Basic Functions of an Accounting System : 

Basic Functions of an Accounting System Interpret and record business transactions.

Objectives of External Financial Reporting : 

Objectives of External Financial Reporting The primary external users of financial information are investors and creditors.

Slide 9: 

Objectives of Financial Reporting

Objectives of External Financial Reporting : 

Objectives of External Financial Reporting The primary financial statements.

Slide 11: 

Financial Reporting Financial Reporting Financial Statements Financial Statements: A Lens to View Business

Characteristics of Externally Reported Information : 

Characteristics of Externally Reported Information A Means to an End Broader than Financial Statements Historical in Nature Results from Inexact and Approximate Measures Based on General Purpose Assumption Usefulness Enhanced via Explanation

Internal Users of Accounting Information : 

Internal Users of Accounting Information Board of Directors Chief Executive Officer Chief Financial Officer Vice Presidents Business Unit Managers Plant Managers Store Managers Line Supervisors

Slide 15: 

Information about decision-making authority, for decision-making support, and for evaluating and rewarding decision-making performance. Information useful in assessing both the past performance and future directions of the enterprise and information from external and internal sources. Information useful to help the enterprise achieve its goal, objectives and mission. Objectives of Managerial Reporting

Characteristics of Management Accounting Information : 

Characteristics of Management Accounting Information Timeliness Identify Decision-Making Authority Oriented Toward Future Measures of Efficiency and Effectiveness A Means to an End

Integrity of Accounting Information : 

Integrity of Accounting Information Institutional Features Generally Accepted Accounting Principles (GAAP) Financial Accounting Standards Board Securities and Exchange Commission Internal Control Structure Audits

Integrity of Accounting Information : 

Integrity of Accounting Information Professional Organizations American Institute of Certified Public Accountants Institute of Management Accountants Institute of Internal Auditors American Accounting Association

End of Chapter 1 : 

End of Chapter 1