R J FINANCIAL ACCOUNTING SERVICES LIMITED company key information (2024)

FAQs

What is financial accounting basic information? ›

Financial Accounting is the process of recording, summarizing and reporting transactions and revenue-expense generations in a time period. For example, investors or sponsors need to verify an account statement before showing interest in associating with the business.

Financial accounting is the framework that dictates the rules, processes, and standards for financial recordkeeping. Nonprofits, corporations, and small businesses use financial accountants to prepare their books and records and generate their financial reports.

If you own a small business, you understand the importance of keeping your financial information organized. There are four basic types of financial statements used to do this: income statements, balance sheets, statements of cash flow, and statements of owner equity.

These three golden rules of accounting: debit the receiver and credit the giver; debit what comes in and credit what goes out; and debit expenses and losses credit income and gains, form the bedrock of double-entry bookkeeping.

Examples of internal users are owners, managers, and employees. External users are people outside the business entity (organization) who use accounting information. Examples of external users are suppliers, banks, customers, investors, potential investors, and tax authorities.

The main purpose of financial accounting is to provide relevant and reliable financial information about a business or organisation to external users like investors, creditors, regulators and other stakeholders.

The purpose of accounting is to accumulate and report on financial information about the performance, financial position, and cash flows of a business. This information is then used to reach decisions about how to manage the business, or invest in it, or lend money to it.

The primary functions of an accounting system are to track, report, execute, and predict financial transactions. The basic function of financial accounting is to also prepare financial statements that help company leaders and investors to make informed business decisions.

For-profit primary financial statements include the balance sheet, income statement, statement of cash flow, and statement of changes in equity. Nonprofit entities use a similar but different set of financial statements.

What is financial accounting in a nutshell? ›

Financial accounting focuses on tracking every transaction that occurs within a business, which is recorded and summarized using generally accepted accounting practices and standards. This essential information appears in financial statements like income statements, balance sheets, and cash flow statements.