What is the importance of accounting? Accounting is vital in any organization. It has the most important role is allowing members of the organization’s leadership to understand the company’s financial position. Accounting helps business leaders make data-driven decisions that impact budgeting, planning, resourcing and controlling processes.
- Accounting is the information system that measures business activities, process information into reports and communicates results to decision makers.
- It is used by decision makers, individuals, businesses, investors, creditors and taxing authorities
- Two types of accounting :
- Financial – external decision makers
- Managerial – internal decisions makers
- Accountants work in the private, public and governmental jobs. All businesses need accountants.
The importance of accounting goes far beyond record and bookkeeping. The knowledge that it provides is used every day to help make decisions.