Synthesis

A Synthesis on Accounting and Non-Accounting Information |

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The primary objective of accounting is to provide information that is useful for decision-making purposes. From the very start, we emphasize that accounting is not an end, but rather it is a means to an end. And to start the cycle, the enterprise need to supply to us, the accountants, certain information that would enable us to render our services. The final product of these accounting information is the decision that is enhanced by the use of the information, whether the decision is made by owners, management, creditors, governmental regulatory bodies, labor unions, or the many other groups that have an interest in the financial or over-all performance of the enterprise.

Many people think of accounting as a highly technical field practiced only by professional accountants. In reality, nearly everyone uses accounting information daily. Accounting information is the means by which we measure and communicate economic events. Whether you manage a business, make investments, or monitor how you receive and use your money, you are working with accounting concepts and accounting information. The accounting process produces accounting information used by decision makers in making economic decisions and taking specific actions. These decisions and actions result in economic activities that continue a cycle – the accounting cycle.

Accounting information is linked on capital allocation decision process. Without good information, misallocation of capital would occur and result in inefficient production and shortages. That is why most organizations devote fair amount of time and effort to considering their goals and objectives. Foremost among the objectives of accounting and reporting is to provide useful information for investors, creditors, analysts, government, and others. Accounting information is general purpose and should be designed to serve the information needs of all...