Textbook Notes (368,432)
Canada (161,877)
MGTA02H3 (363)
H Laurence (23)
Chapter 4

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Department
Management (MGT)
Course
MGTA02H3
Professor
H Laurence
Semester
Fall

Description
Chapter 4 Understanding Accounting IssuesWhat is a Accounting and Who Uses Itaccounting a comprehensive system for collecting analyzing and communicating financial informationbookkeeping recording accounting transactions just one phase of accountingby sorting analyzing and recording thousands of transactions accountants can determine how well a business is being managed and how financially strong it is but accounting systems can produce distorted results that cause problems for owners and managersaccounting information system an organized procedure for identifying measuring recording and retaining financial information so that it can be used in accounting statements and management reports dependable consistent mandatory systemusers of accounting informationbusiness managers to set goalsdevelop plans set budgets and evaluate future prospectsemployees and unions to get paid and to plan for and receive such benefits as healthcare insurance vacation time and retirement payinvestors and creditors to estimate returns to stockholders to determine a companys growth prospects and to decide if it is a good credit risk before investing or lendingtaxing authorities to plan for tax inflows to determine the tax liabilities of individuals and businesses and to ensure that correct amounts are paid in a timely fashiongovernment regulatory agencies to fulfill their duties the provincial securities commissions for example require firms to file financial disclosures so that potential investors have valid information about a companys financial statusWho are Accountants and What Do They Docontrollerthe individual who manages all the firms accounting activities head of AISensures that reports and statements needed for planning controlling and decision making activities are providedfinancial accounting system the process whereby interested groups are kept informed about the financial condition of a firm concerned with external users of info such as consumer groups unions govtprepares and publishes income statements and balance sheets at regular intervalslooks at company as a wholemanagerial accounting internal procedures that alert managers to problems and aid them in planning and decision making serves internal users such as different departmentsex managers to monitor current projects and plan for future activitiesex engineers may look at costs of materials or production to make operations improvementinternal reports are forward looking in nature not historicalProfessional Accountantschartered accountant CA an individual who has met certain experience and education requirements and has passed a licensing examination acts as an outside accountant for other firms granted by The Canadian Institute of Chartered Accountants to people who have a university degree competed an educational program and passed the national examhalf CA are public half are government or industry workersCA focus on external financial reportingcertified general accountant CGA an individual who has completed an education program and passed a national exam works in a private industry or a CGA firm formerly not allowed to audit financial statements of publicly held companies but this is changing in most provincessome work in private CGA firms CA firmsfocus on external financial reporting and use computer as management accounting toolcertified management accountant CMA an individual who has completed a university degree passed a national examination and completed a strategic leadership program works in industry and focuses on internal management accounting work in organizations of all sizesCMAs bring a strong market focus to strategic management and resource deployment
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