Chapter 1

Introduction to accounting

‘One way to cheat death is to become an accountant, it seems. The Norfolk accountancy firm W.R. Kewley announces on its website that it was “originally established in 1982 with 2 partners, one of whom died in 1993. After a short break he re-established in 1997, offering a personal service throughout.” He was, feedback presumes, dead only for tax purposes.’

New Scientist, 1 April 2000, vol. 166, no. 2232, p. 96. © Reed Business Information Ltd, England. Reproduced by permission.


Learning Outcomes

After completing this chapter you should be able to:

  • Explain the nature and importance of accounting.
  • Outline the context which shapes accounting.
  • Identify the main users of accounting and discuss their information needs.
  • Distinguish between the different types of accountancy and accountant.

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Chapter Summary

  • Accounting is the provision of financial information to managers or owners so that they can make business decisions.
  • Accounting measures, monitors and controls business activities.
  • Financial accounting supplies financial information to external users.
  • Management accounting serves the needs ...

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