Explanation of Accounting From the User's Point and Process Activities
Accounting is often referred to as "the Language of Business" or "Language of Decision Making", this is because the more we can understand and master the science of accounting, the better it will be in handling the business world, especially aspects of corporate finance.
Accounting From the User's Point and Process Activities
The definition of accounting can be formulated from two perspectives, namely the user angle and the process of its activities. For more details from each refer to the following review.
Accounting From the User's Angle
Accounting can be defined as a discipline that provides information needed to carry out activities efficiently and evaluate the activities of an organization. The benefits of accounting information include:
Make effective planning, supervision and decision making by management.
And the accountability of the organization to investors, creditors, the government and so on.
Accounting from the Activity Process Angle
In this case, from the point of view of its activities, accounting can be defined as a process of recording, classifying, summarizing, reporting and analyzing an organization's financial data. Basically accounting includes the following activities.
Identifying data related to decision making, both data from internal companies and data from external companies.
Process or analyze relevant data.
Turn data into information that can be used for decision making, for example for business development or business expansion, additional investment and so on.
Apart from the two points of view above, the accounting definitions according to the experts are as follows:
According to ABP Statement No. 4, Smith Skousen (1995: 3)
Accounting is a service activity, its function is to provide quantitative information, especially those that are in economic decision making in determining logical choices among alternative actions.
According to the American Institute of Certified Public Accounting (AICPA) in Harahap (2003) defines accounting as the art of recording, classifying and summarizing in certain ways in monetary measures, transactions and events that are generally of a financial nature including interpreting the results. as a tool for entrepreneurs in making economic decisions and carrying out the tasks of company management, especially in the field of planning and supervision. Therefore, accounting is widely studied by entrepreneurs and taught from high schools to tertiary institutions.
According to Rudianto
Define that accounting is an information system that produces reports to interested parties regarding economic activity and the condition of a business entity.
According to Charles T. Horngren and Walter T. Harrison (Horngren Harrison, 2007: 4)
States that ; Accounting is an information system that measures business activities, processes data into reports and communicates the results to decision makers.
Elements of an Accounting System - Definition, Criteria, Differences, Components, Design
Accounting System Elements - Definition, Criteria, Differences, Components, Design: The elements contained in an accounting system are interrelated with each other, so data can be processed from the beginning of the transaction to reporting that can be used as accounting information.
Elements of an Accounting System
Understanding Accounting System
The main function in an accounting system is to encourage as much as possible so that the system can produce a structured sharing of accounting information that is timely, relevant and trustworthy.
The elements contained in an accounting system are interrelated with each other, so that data processing can be carried out starting from the beginning of the transaction up to reporting that can be used as accounting information.
The main element in the accounting system is a record form consisting of journals, ledgers, ledgers and reports produced. In an accounting system there are basic elements like those raised by Mulyadi in his accounting system.
Accounting System Criteria
From this definition the general understanding of the accounting system criteria is as follows:
Each system consists of elements
The elements of a system consist of smaller subsystems which also consist of groups of elements that make up the subsystem.
These elements are an integrated part of the system concerned
The elements of the system are closely related to each other and the nature and cooperation between the elements of the system have a certain form.
The system elements work together to achieve system goals
Every system has a specific purpose.
A system is part of another larger system
Elements of an Accounting System
In the accounting system elements as follows:
Form
Journal entry
Ledger
Maid book
Report
Of the five elements of the accounting system according to Mulyadi, the basic accounting system elements are as follows.
Form
This document is used to record the transaction, with this form the data related to the recorded transaction was first used as the basis for recording.
Journal entry
It is the first accounting record used to record, classify and summarize financial data and other data. In this journal there are also data summarizing activities, the results of which are summarized and then posted to the relevant accounts in the ledger.