Meaning and Scope of Accounting

Bookmark added to your notes.
View Notes
×

Most students who are preparing for their exams might need to know about the meaning and scope of accounting since it is one of their chapters. To clear out their doubts, we have some notes. 

Accounting is a language that is used to understand finance. It can be used to convey the financial position of any particular company or business. Accounting can also help in translating the functions of the company in the mode of some tangible reports. So, people need to know more about accounting. That is exactly what we are here for. These notes are going to define accounting to explain the objectives and scope of accounting.

 

What is the Meaning of Accounting

When it comes to the meaning scope and role of accounting, there are some things that students need to be familiar with. Accounting is just the process that helps in recording, summarizing, analyzing, and then reporting the data which is concerned with the different financial transactions that happen in a company. So, here we are going to talk a bit more about the meaning of scope of accounting to those who need to know. 

The first function that students are going to learn in the definition and scope of accounting notes is the recording of the data. This is also known as book-keeping. This process helps in tracking financial data and preparing reports of it. 

The next function would be to summarize the raw data that is collected after recoding different transactions. Since raw data is not much of a use for the organizations, these are mainly summarized. This further helps in the decision-making processes. 

After the summarizing of data, the information is then provided to the management. This is known as reporting. This helps the owners get a better idea about the company. The next step is the analysis of the data to create better functions and decisions for the company.

These are some of the important things that students need to know about when they are studying the meaning and scope of accounting. 

Objectives of Accounting 

With the help of our notes that define accounting explain the objectives and scope of accounting, students can score some top marks in the examination. However, just having that information is not enough. Students also need to know about the objectives of accounting. Here we are going to discuss that. These are some of the objectives of accounting. 

  • Accounting helps in the facilitation of systematic management of financial data and records of transactions. 

  • Accounting provides a particular idea about the possibility of the company experiencing profits or loss. 

  • Accounting also helps in the management process and assists in decision making. 

  • Accounting is a great help when it comes to the evaluation of the employees by increasing their working efficiency. 

  • Accounting is a major contribution when it comes to the prevention of fraud and profit risks. 

So, these are exactly the details that students are going to learn in the meaning and scope of cost accounting notes.

 

Subsections of Accounting and their Scopes 

There are different sub-fields of accounting and different scopes to such fields too. They are mentioned here. 

1. Management Accounting

Students need to know about the meaning of nature and scope of management accounting if they aim to stay on top of the class. Management accounting is the type of accounting that deals with all the management and manager related information. This type of accounting can help managers take a good look at their employees and make better decisions. Students can find more information from the meaning and scope of management accounting notes. 

2. Cost Accounting 

Some students also need to know about the meaning and scope of cost accounting if they want to score good marks in examinations. Well, cost accounting is the process that deals with recording and ultimately analyzing the costs which are made by the company. Students can find more details in the cost accounting meaning nature and scope. 

3. Financial Accounting 

Students need to know financial accounting definition and scope if they want to get a piece of in-depth knowledge about the field. To put it in simple words, financial accounting is the type of accounting that deals with the interpretation and the preparation of different financial statements as well as the accounts that are a part of the company as a whole.

There are some other sub-fields of accounting such as human resources accounting and social responsibility accounting.

FAQ (Frequently Asked Questions)

1. Define Management Accounting Discuss its Nature and Scope? 

Ans: Management accounting is the process of accounting that mainly deals with information and accounts which are to help the managers understand the company in a better way. One of the main scopes of management accounting is that it helps the authorities to make better-decisions for company management. Students can find more in the notes for management accounting meaning nature scope.

2. Name the Different Sub-Fields of Accounting?

Ans: The different subfields of accounting are Financial accounting, cost accounting, management accounting, human resources accounting, and social responsibility accounting.

3. Name One Objective of Accounting?

Ans: One of the many objectives of accounting is that it helps a lot when it comes to the facilitation of financial data which is to be interpreted and recorded for the sake of the company.