Introduction to Accounting

 Various Types of Organization

 Understand the meaning and nature of accounting
 Differentiate between various types of accounting
Toyota Motor Van Manufacturing!!!
Public Company
Ordinary Share
➢ Voting Right(Ownership)
➢ Dividend (No Fixed)

5%Preference Share
➢ No voting right
➢ % Dividend (Fixed)

Bonds
➢ Interest
Introduction to Accounting
 Book-keeping provides the basis for accounting and it
is complementary to accounting process.

 Accounting begins where book-keeping ends.

 Accountancy includes accounting and book-keeping.

The terms Accounting and Accountancy are used
synonymously.
What is Bookkeeping?
 Bookkeeping is the
recording part of this
process, in which all of the
financial transactions of
the business (consisting of
income and expenses) are
entered into a database.
Definition of Accounting
 Accounting is the
process by where a
company's financials
are recorded,
summarized,
analyzed, consulted
and reported on.
Accountancy
 Accountancy refers to a systematic knowledge of
accounting. It explains “why to do” and “how to do” of
various aspects of accounting. It tells us why and how
to prepare the books of accounts and how to
summarize the accounting information and
communicate it to the interested parties.
Objectives of Accounting
 The main objectives of accounting are
➢ to maintain accounting records.
➢ to calculate the result of operations.
➢ to ascertain the financial position.
➢ to communicate the information to users.
The Accounting Process
Types of Accounting
Financial Accounting ?

Financial Accounting
Financial Accounting
 Financial accounting is a specific branch of
accounting involving a process of recording,
summarizing, and reporting the myriad of transactions
resulting from business operations over a period of
time.
 These transactions are summarized in the preparation
of financial statements, including the balance
sheet, income statement and cash flow statement, that
record the company's operating performance over a
specified period.
Management Accounting ?
Management Accounting
▪ Management accounting also is known as managerial
accounting and can be defined as a process of
providing financial information and resources to the
managers in decision making.

▪ Management accounting is only used by the internal

team of the organization, and this is the only thing
which makes it different from financial accounting.
Cost accounting
Cost accounting
 Cost Accounting is a business practice in which we
record, examine, summarize, and study the company’s
cost spent on any process, service, product or
anything else in the organization.

 This helps the organization in cost controlling and

making strategic planning and decision on improving
cost efficiency.
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