There is no doubt that accounting is the language of a business. So, accountants are always needed by businesses to help the owners understand the language. They set up the accounting system. Then, prepare, analyze, and advise on the information provided by the system.
What is accounting?
It can be defined as a system put in place to aid the collection of business transactions, organize and summarize the transactions to produce information, and prepare and analyze reports to provide advice to decision-makers.
A well-known definition of accounting is that it is the process of collecting, recording, organizing, presenting, analyzing, and interpreting financial transactions to help users make informed economic decisions.
From both definitions, one thing is common: providing advice to decision makers. This is the primary reason why a business needs accounting. From the data collected to the report presentation and analysis, accountants are called upon to give advice to the users of accounting information. These users are explained in detail in a different article.
Who is an accountant?
An individual who has undergone rigorous training in accounting principles, standards, computations, and their applications in business for the purpose of helping business and non-profit entities and their users make informed decisions.
The accounting role has widened. In earlier years, accountants prepared financial reports. For example, the trading, profit or loss accounts, and balance sheets. As years passed, other reports, such as cash flow statements and tax computations, became the responsibility of the accountants. Next was the extraction of the finance subject from economics, accounting, mathematics, and statistics.
The body of knowledge of finance was then given to the accountants as a new responsibility. This is where the accounting advisory role comes into play. However, in recent times, professional accountants are separating the finance role from the accounting role.
In modern times, global compliance is needed by stock market companies. This has broadened the accountants' role in business. Corporate governance, ethics, and sustainability are the new stewardship roles for accountants. Therefore, to remain relevant, professional accountants must continue to learn.
In conclusion, accountants install the accounting system of an organisation. They are trained to understand businesses and give advice. Accountant roles as stewards and gatekeepers of businesses have evolved over the centuries. To remain relevant, accountants must continue to learn, unlearn, and relearn.