JERICHO B.

ANTONIO
IV-Diligence

1. How accounting came to our life?

The entire success of that small business can rest in your basic accounting skills, and the
knowledge you have of applying those skills in the business environment. The key to successful
operation of a business lies in the knowledge you possess about the particular industry or
profession in which your business operates, and good accounting practices. There is not one
area, other than your expertise, that will have the impact that accounting will on your
business. Your ability to establish profitability levels, pricing, and labor control will rely heavily
on accounting knowledge.

2. Define accounting and accountancy.

Accounting, or accountancy, is the measurement, processing and communication of financial
information about economic entities. Accounting, which has been called the "language of
business",measures the results of an organization's economic activities and conveys this
information
to
a
variety
of
users
including investors, creditors,management,
and regulators. Practitioners of accounting are known as accountants.
Accounting can be divided into several fields including financial accounting, management
accounting, auditing, and tax accounting. Financial accounting focuses on the reporting of an
organization's financial information, including the preparation of financial statements, to
external users of the information, such as investors, regulators andsuppliers; and management
accounting focuses on the measurement, analysis and reporting of information for internal use
by management. The recording of financial transactions, so that summaries of the financials
may be presented in financial reports, is known as bookkeeping, of which double-entry
bookkeeping is the most common system.
Accounting is facilitated by accounting organizations such as standard-setters, accounting
firms and professional bodies. Financial statements are usually audited byaccounting firms, and
are prepared in accordance with generally accepted accounting principles (GAAP). GAAP is set
by various standard-setting organizations such as the Financial Accounting Standards
Board (FASB) in the United States and the Financial Reporting Council in the United
Kingdom.[10] As of 2012, "all major economies" have plans to converge towards or adopt
the International Financial Reporting Standards (IFRS).

3. Why do we think accounting is important to our lives?

Accounting is a very important term to our modern society. It is the career for men and women
who at the start have their eyes set on top positions in industry, management, government,
and general business. Accounting is a basic need of every businessmen, from the operator of a
filling station to the government of the United States. Its so important to our society. None of

JERICHO B. ANTONIO
IV-Diligence

the business organization can operate without is. They are there-somewhere-in every business.
In small business, people use pen, ink and skill keep the records. In large business, modern
accounting machines are used to operate. Men and women are directing these machines in the
accounting process. Wise businessmen enter business must have some accounting knowledge.
Accounting is a vital element of business. It records the way a business has grown and, after
analyzing figures, suggests the way it should go in the future. Furtunes are gambled on the
advice of accountants. If your friend has ever operated a business and you saw him placing
figures in ledgers, then you saw him doing bookkeeping. If you have worked at a service station
or supermarket and have seen books with large sheets lined in green and red lying on the
managers table or desk, you saw books of accounting. Accounting is one of the fastest growing
fields in the United States It expands each time a new store, a factory, a filling station, or a
school goes up, whether in a large city or a small town. In todays society, the demand for good
accountants for exceeds the supply. As our country has expanded, business and industry have
become more and more complex, so control here is very important. And control depends on a
great deal of the bookkeepers and accountants who can analyze figues and advise management
on what should be done.

4.

Give some sectors in the industry that uses accounting.

International Standards on Auditing (ISA)
International Auditing Practice Statements (IAPS)
Philippine Standards on Auditing (PSA)
Quality Review Committee (QRC)