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ENGLISHLANGUAGEINACCOUNTINGPage1of122UnitOneAccountingProfessionINTRODUCTIONOFACCOUNTING.Accountingisaprocessofrecorded,classifying,summarizing,andinterpretingofthosebusinessactivitiesthatcanbeinexpressedinmonetaryterms.Apersonwhospecializesinthisfieldisknownasanaccountant.Accountingfrequentlyoffersthequalifiedpersonanopportunitytomoveaheadquicklyintoday’sbusinessworld.Indeed,manyoftheheadsoflargecorporationsthroughouttheworldhaveadvancedtotheirpositionfromtheaccountingdepartment.Accountingisabasicandvitalelementineverymodernbusiness.Itrecordsthepastgrowthordeclineofthebusiness.Carefulanalysisoftheseresultsandtrendsmaysuggestthewaysinwhichthebusinessmaygrowinfuture.Expan-sionorreorganizationshouldnotbeplannedwithoutproperanalysisoftheaccountinginforma-tion;andnewproductsandthecampaigntoadvertiseandsellthemshouldnotbelaunchedwith-outthehelpofaccountingexpertise.Accountingisoneofthefastestgrowingprofessionsinthemodernbusinessworld.Everynewstore,school,restaurant,orfillingstationindeed,anynewenterpriseofanykindincreasesthedemandforaccountants.Consequently,thedemandforcompetentaccountantsisgenerallymuchgreaterthanthesupply.Governmentofficialsoftenhavealegalbackground;similarly,themenorwomeninmanagementoftenhaveabackgroundonaccounting.Theyareusuallyfamiliarwiththemethodologyoffinanceandthefundamentalsoffiscalandbusinessadministration.DISTINCTIONBETWEENBOOKKEEPINGANDACCOUNTINGEarlieraccountingproceduresweresimpleincomparisonwithmodernmethods.Thesimplebookkeepingproceduresofahundredyearsagohaveplacedinmanycasesbythedata-processingcomputer.Thecontrolofthefiscalaffairsofanorganizationmustbeasscientificaspossibleinordertobeeffective.Inthepast,abookkeeperkeptthebooksofaccountsforanorganization;thepresent-dayac-countants’jobdevelopedfromthebookkeepers’job.Today,asharpdistinctionismadebetweentherelativelyunchangedworksperformedbyabookkeeperandthemoresophisticateddutiesof2122theaccountants.Thebookkeepersimplyentersdatainfinancialrecordsbooks;theaccountantmustunderstandentiresystemofrecordssothatheorshecananalyzeandinterpretbusinesstransaction.Toexplainthedifferencebriefly,theaccountantsetsupabookkeepingsystemandinterpretsthedatainit,whereasthebookkeeperperformstheroutineworkofrecordingfiguresinbooks.Becauseinterpretationofthefiguresissuchanimportantpartoftheaccountant’sfunction,accountinghasoftenbeendescribedasanart.DIVISIONSOFACCOUNTINGThefieldofaccountingisdividedintothreebroaddivisions:public,private,andgovernmental.AcertifiedaccountantoraCPA,asthetermisusuallyabbrevi-ated,mustpassaseriesofexaminations,afterwhichheorshereceivesacertificate.IntheUnitedStates,thecertificationexaminationsarepreparedandadministeredbytheAmericanInstituteofCertifiedPublicAccountants.Thevariousstatesorothermajorgovernmentaljurisdictionssetad-ditionalqualificationsforresidence,experience,andsoon.TheBritishequivalentforaCPAiscalledachartedaccountant.CPACPACPAscanoffertheirservicestothepubliconanindividualconsultantbasisforwhichtheyreceiveafee.Inthisrespectormanyothers,theyaresimilartodoctorsorlawyers.Likethem,CPAsmaybeself-employedorpartnersinafirm;ortheymaybeemployedbyanaccountingfirm.Manyaccountantsworkedingovernmentofficesorfornonprofitorganizations.Thesetwoareasareoftenjoinedunderthetermgovernmentandinstitutionalaccounting.Thetwoaresimilarbecauseoflegalrestrictionsinthewayinwhichtheyreceiveandspendfunds.Therefore,alegalbackgroundissometimesnecessaryforthistypeofaccountingpractice.Allbranchesofgovernmentsemployaccountants.Inaddition,government-ownedcorpora-tionhaveaccountantsontheirstaffs.Alloftheseaccountants,likethoseinprivateindustry,workonasalarybasis.Theytendtobecomespecialistsinlimitedfieldsliketransportationorpublicutilities.ENGLISHLANGUAGEINACCOUNTINGPage3of122Nonprofitorganizationsare,ofcourse,inbusinessforsomepurposeotherthanmakingmoney.Theyincludeculturalorganizationslikesymphonyorchestrasoroperasocieties,charitableorganizations,religiousgroups,orcorporate-ownedresearchorganizations.Althoughtheyarelim-itedinthemannerinwhichtheycanraiseandspendtheirfunds,theyusuallybenefitfromspecialprovisionsinthetaxlaws.Privateaccountants,alsocalledexecutiveoradministrativeaccountants,handlethefinancialrecordsofabusiness.Likethosewhoworkforgovernmentornonprofitorganizations,theyaresalariedratherthanpaidafee.Thosewhoworkformanufacturingconcernsaresometimescalledindustrialaccountants.Somelargecorporationsemployhundredsofemployeesintheiraccountingoffices.Thechiefaccountingofficerofacompanyisthecontroller,orcomptroller,asheorsheissometimescalled.Controllersareresponsibleformaintainingtherecordsofthecompany’sopera-tions.Onthebasisofthedatathathavebeenrecorded,theymeasurethecompany’sperformance;theyinterprettheresultsoftheoperations;andtheyplanandrecommendfutureactions.Thisposi-tionisveryclosetothetopofmanagement.Indeed,acontrollerisoftenjustastepawayfrombe-ingtheexecutiveofficerofacorporation.Manypeoplehavechosenaccountingasaprofessionalbecauseofitsmanyadvantages.Manyjobsareavailable,primarilybecausetheeducationandtrainingforaccountingcareershavenotk