Posted: September 2nd, 2022

Budgeting

Budgeting
Budgeting is the process of creating an organizational financial plan for a defined period. The financial plan is known as the budget. It incorporates all the expected expenses and operational revenue. It also indicates the available assets, liabilities and sales volume. There are two types of approaches in budgeting; bottom-up and up-down approach. The up-down is whereby the administration prepares the budget. Bottom-up is a type of approach where various departments prepare the budget and pass the information to the managers. Budgeting not only helps track financial transactions but also brings about growth in an organization.
Auditing
Auditing is an independent examination that is done to establish whether organizational processes and financial records conform to the required standards. The law requires a company to have an external audit firm that undertakes the audit process and establishes whether the company’s financial statements adheres to the required standards and requirements. There are different types of auditing; product audit, management, and process audit. Product audits focus on examining products and services, management looks at management systems and process audits look at the methods and processes an organization is applying and whether they conform to the required standards.
Accounting information system
Accounting information systems are computer-based systems that collect, stores and process financial and accounting information for use by decision-makers. Decision-makers include both the management and external sources such as tax authorities, investors and creditors. The system allows data input and interface interdependence in various department, for instance, the sales department may update the sales volume and the data reflects on the inventory department, the inventory department uses the information to make a new order and the invoice is sent to all other departments including customer care. Accounting information systems play an integral part in enabling tracking of financial transactions and enhances the security of data through login requirements, division of duties and authorizations.
Tax accounting
Tax accounting is a branch of accounting that concentrates on the preparation, analysis, and provision of tax returns and payments. These are processes and methods applied in matters related to tax. In the United States of America. The internal revenue code dictates the rules that should be followed in filing tax returns. Individuals, businesses, corporates, and all tax-exempt organizations should participate in filing annual tax returns. Unlike individual annual tax returns whereby less information about the person is required such as income, deductions, and investment gains and deductions. Filling business tax returns is more complex and at times the business is forced to hire an accountant who specifically deals with tax returns. Tax accounting tracks funds that the business is required to deduct tax from.
Managerial accounting
Managerial accounting is a branch of accounts that deals with processes of identifying, interpreting, analyzing and communicating information to internal managers. The managers use the information in decision making to achieve company goals. Managerial accounting also checks the strengths and weaknesses of the business to aid in improving its processes and strategies. Unlike financial accounting managerial accounting does not follow any generally accepted accounting principles.
Financial accounting
Financial accounting is a branch of accounting that deals with preparation, analysis, interpretation, and presentation of financial transactions in the form of financial statements or reports. The reports are mostly prepared for stakeholders, lenders, investors, creditors or any other external entity that is interested in either investing or providing resources to the company. Financial accounting is governed by several rules and generally accepted accounting principles from both the local and the international settings. Financial accounting aims at identifying the financial transactions, providing important information that will guide in decision making to the users and showing the financial position of an organization. Financial statements comprise of a balance sheet, cash flow, stakeholder’s equity, and income statement. The statements should be relevant to the users and adhere to the rules that dictate how they should be prepared and presented.
Forensic accounting
Forensic accounting is a branch of accounts that deals with examination and investigation of financial information to be used in dispute resolution. It is mainly done to gather evidence to be presented in court. Forensic accounting is engaged where there are issues such as breach of contract, money laundering, computer forensic and tax evasion. It is mainly used to investigate the embezzlement of funds. The process involved in forensic accounting includes data collection, preparation, analysis, and reporting.

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