ACCOUNTING AS A BUSINESS MANAGEMENT TOOL

Writing Article

Importance of coordination

One of the essential requirements of an organization is to achieve the objectives and goals established on time maintaining adequate coordination between the different commercial departments for many commercial activities. The coordination of these commercial activities would help the business to decide to buy with the sales, the expense with the income and also to make decisions in the sales with the realization of the debt. Such coordination would help to align most of the commercial activities and, therefore, to the adequate decision making in the long term.

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Importance of control

One of the important functions of accounting and modern business management is to maintain control over the functions and various activities of a company. Accounting helps the organization by providing all the information required and, therefore, controlling various activities of a company (Jermias, 2004).

Importance of media communication

The media have an important role to play in any organization with regard to what media are used to supply commercial information to their various sectors. In addition to assisting in the decision-making process, another important function of accounting is to maintain business information and provide information to interested parties.

Importance of the budget

Budget preparation is essential for an organization to be able to run its operations without problems. The accounting helps in the decision making of the process by preparing the supplied budget and the information maintained, respectively.

CONCLUSIONS

In the competitive business environment, accounting plays a vital role in maintaining all past and present records of a business. Accounting information is essential in the decision-making process. The article suggests that delivering the financial and economic information of an organization is one of the most desired functions of an organization and this can only be made possible through accounting information. It is an accounting that provides us with information that allows us to make the right decision in the right direction, and this is the most vital tool in the business management process.

This document concludes that accounting is the backbone of any business, it can be useful in many aspects. As discussed, accounting can be useful for any other department of the company. Managers, employees, interested parties, government entities are also related to the accounting department of any company. The growth and progress of the company can be determined simply by analyzing the financial report of the company, which is prepared by the accounting department.

As we discussed, accounting is one of the old fields of interest for people. Accounting has become more complex and has evolved a lot in recent decades. But technology also helps to understand accounting. As there are many accounting software, they are made to increase the usability of accounting. People must obtain knowledge about accounting since the importance and benefits are discussed in the article.

BIBLIOGRAPHIC REFERENCES

Beke, J. (2011). International Accounting Standards Effects on Business Management. Business Management and Strategy, 2 (1), 3.

Burritt, RL, Hahn, T., & Schaltegger, S. (2002). Towards a comprehensive framework for environmental management accounting-Links between business actors and environmental management accounting tools. Australian Accounting Review, 12 (27), 39-50.

Choudhury, N. (2006). Starting Out in Management Accounting Research. Accounting and Business Research, 17 (67), 205-220.

Giovannoni, E., Maraghini, MP, & Riccaboni, A. (2011). Transmitting knowledge across generations: The role of management accounting practices. Family Business Review, 24 (2), 126-150.

Gul, F. (2016). The Effects of Management Accounting Systems and Environmental Uncertainty on Small Business Managers’ Performance. Accounting and Business Research, 22 (85), 57-61.

Jermias, J. (2004). Integrating business strategy, organizational configurations and management accounting systems with business unit effectiveness: a fitness landscape approach. Management Accounting Research, 15 (2), 179-200.

Mitchell, F., & Reid, G. (2000). Editorial. Problems, challenges, and opportunities: the small business as a setting for management accounting research. Management Accounting Research, 11 (4), 385-390.

* CPA Accounting and Audit Engineer from the Higher Polytechnic School of Chimborazo. Master in Integral Auditing at the Universidad T├ęcnica Particular de Loja. Currently studying the Doctoral Program in Accounting Sciences of the University of Los Andes in Venezuela and Professor of Accounting in the School of Business Administration of the Polytechnic School of Chimborazo.

** Business Engineer. Master in Public and Social Policies of the Pompeu Fabra University of Spain and Johns Hopkins United States. Administrative Assistant at the Consulate General of Ecuador in Barcelona. Postgraduate Coordinator – Master in Development Project Management. Currently, a professor at the School of Business Administration of the Polytechnic School of Chimborazo and is part of the research group “Fabrica de Ideas” at the IDI Research Institute of ESPOCH.