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SUB-FIELDS OF ACCOUNTING

by Accounting Education | posted: 08:01 | 12 comments

The various sub-fields of accounting are as under:

1. Financial Accounting: It covers the preparation and interpretation of financial statements and communication to the users of accounts. It is historical in nature as it records transactions which had already been occurred. The final step of financial accounting is the preparation of Profit and Loss Account and the Balance Sheet. It primarily helps in determination of the net result for an accounting period and the financial as on a given date.

2. Management Accounting: It is related to internal reporting to the owner and management of a business unit. To discharge the functions of stewardship, planning, control and decision making, the owner and management needs variety of information. The different ways of grouping information and preparing reports as desired by managers for discharging their functions are referred to as management accounting. A very important component of the management accounting is cost accounting which deals with cost ascertainment and cost control.

3. Cost Accounting: The terminology of cost accounting published by the Institute of Cost and Management Accountants of England defines cost accounting is as follows:
"the process of accounting for cost which begins with the recording of income and expenditure or the bases on which they are calculated and ends with the preparation of periodical statements and reports for ascertaining and controlling costs."

4. Social Responsibility Accounting: The demand for social responsibility accounting stems from increasing social awareness about the undesirable by-products of economic activities. As already discussed earlier, social responsibility accounting for social costs incurred by the enterprise and social benefits created.

5. Human Resource Accounting: Human resource accounting is an attempt to identify quantity and report investments made in human resources of an organization that are not presently accounted for under conventional accounting practice.

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  2. APC21 February 2016 at 05:48

    I can't see a point - 'Tax Accounting'. Is it right or wrong?

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  8. Unknown30 September 2018 at 01:53

    I can't see a point 'National Accounting'
    Is it right or wrong??????

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