9. Certified General Accountant (CGA): an individual who has completed an
education program and passed a national exam; works in private industry or a CGA
oMust have accounting job with company.
oMost work in private companies.
oAudit corporate financial statements
10. Certified Management Accountant (CMA): an individual who has completed a
university degree, passed a national exam, and completed a strategic leadership
program; works in industry and focuses on internal management accounting.
oStrong market-focus to strategic management and resource deployment,
synthesizing and analyzing financial and non-financial information to help
organizations maintain a competitive advantage.
11. Audit: an accountants examination of a company's financial records to determine
whether it is sued proper procedures to prepare its financial reports.
oDetermines whether the firm has controls to prevent errors or fraud from
oSometimes may physically check inventories, equipments or other assets.
12. Forensic Accountant: an accountant who tracks down hidden funds in business
firms, usually as part of a criminal investigation.
13. Generally Accepted Accounting Principles (GAAP): standard rules and
methods used by accountants in preparing financial reports.
14. Management Consulting Services: specializing accounting services to help
managers resolve a variety of problems in finance, production scheduling, and other
15. Private Accountant: an accountant hired as a salaried employee to deal with a
company's day to day accounting needs.
The Accounting Equation
16. Accounting Equation: the most basic tool of accounting, used to balance the data
pertaining to financial transactions:
oAssets=liabilities + owner's equity
•The equation must be in balance.
17. Asset: any economic resource that is expected to benefit a firm or an individual who
oLand, buildings, equipment, inventory, and payments due the company.
18. Liability: a debt that the firm owes to an outside party.
19. Owner's Equity: the amount of money that owners would receive if they sold all of
a company's assets and paid of its liabilities.
(Assets ) - (liabilities)= Owner's Equity