The Role of Accounting in an Organisation

  Introduction Accounting is a systematic process of identifying, recording, classifying, summarising and interpreting financial transactions of a business. It helps organisations to understand their financial performance and financial position at a particular period of time. In the modern business environment, accounting is not limited to bookkeeping; it plays a major role in planning, controlling and decision-making. Every organisation, whether small or large, profit-oriented or non-profit, uses accounting information to manage its resources effectively. Without proper accounting records, a business cannot determine whether it is making a profit or loss, whether it can pay its debts, or whether it is growing or declining. Accounting also improves transparency and accountability. Stakeholders such as investors, banks, government authorities and employees depend on accounting information to make important economic decisions.(Atrill & McLaney, 2019). Figure 1: Accounting suppo...