Viswam Engineering College

Angallu, Madanapalle
Seminar Title: Financial accounting
Presented by:
Shaik. Moulali
MBA II Sem
Roll no:20W51E00E6
Department of Management Studies

UNDER THE GUIDANCE OF

V.R. RAMA KRISHNA P.LOKESH MUNI KUMR
HOD& Associate Professor Asst.Professor
Department of MBA Department of MBA
INTRODUCTION TO FINANCIAL
ACCOUNTIG:

Financial accountig is important for business because it helps

them to keep track of their financial transactions . In
turn,they can make sound decision on how to allocate their
resources .financial accounting helps you to communicate
your business finances to outside parties such as creditors
and investors.
 MEANING
Financial accounting is a specific branch of accounting involving a
process of recording, summarizing and reporting the myraid
transactions resulting from business operations over a period of time.
These trasactions are summarizied in the preparation of financial
statements,including the balancesheet, income statement and cashflow
statement , that record the company’s operating performance over a
specific period.
 DEFINITION

* According to Bierman and Derbin ,

“Accounting may be defined as the
identifying , measuring, recording and
communicate of financial information”.
USERS OF FINANCIAL
ACCOUNTING INFORMATION:
INTERNAL USERS EXTERNAL USERS
• owners\proprietors. •Creditors & investors.
•Customers&researchers.
•Management.
•Govt agencies.
•Employees. •Others.
TYPES OF FINANCIAL
ACCOUNTIG :
1. Cash accounting.
2. Accrual accounting.
FINANCIAL ACCOUNTING
PRINCIPLES:
1.Economic entity assumption.
2. Monetary unit assumptiom.
3. Cost principle.
4.Full-disclosure principle.
5. Going concern principle.
6. Matching principle.
7.Materiality principle.
8.Revenue recognition principle.
9. Conservatism.
FINANCIAL ACCOUNTING STATEMENTS:

•Income statement.
•Balancesheet.
•Cashflow statement.
•Retained earnings statement.
MERITS OF
FINANCIALACCOUNTING:
1. Maintain of business records.
2. Preperation of financial statements.
3. Comparision of results.
4. Decision making.
5. Helps in legal and tax matters.
6. Documentary evidence.
LIMITATIONS:

1. Records only monitory items .

2. Time consuming process.
3. Records only past events \ past data.
4. Rule of consistency.
5. Costly .
CONCLUSION
Financial accounting determines a company’s health and stability, providing
an understanding of how the company conducts its business.
THANK YOU