Accounting is a broad category and involves different types that an organization uses based on their requirements. Here are the main types of accounting that the accounting service company in India follow.
Financial accounting, also commonly known as financial reporting, is the documenting of all the financial expenses and statement of the business organization. These statements are helpful for external as well as internal purposes or references.
It gives the entire financial information. Financial reports are generally maintained as per the Generally Accepted Accounting Principles (GAAP) standards. If the organization is global-based, it should also follow the International Financial Reporting Standards (IFRS).
These statements reflect the organization’s performance in the past and the present while basing them with the financial standards. Along with standards that the organization has to follow, it also includes rules and regulations, and accounting conventions that the accountants should follow.
Management Accounting is a process of calculating all the past and present financial records of the organization mainly used for internally analyzing the business that helps the management in making decisions for the future. Tasks such as asset management, performance evaluation, cost management, and budgeting come under the category of management accounting.
Unlike the standards followed in financial accounting, managerial accounting deals with the management part of the organization, such as studying the performance of the company to plan for the future. There are many accounting services company in India that offer services for organizations.
As the term goes, tax accounting focuses on the company’s tax-related matters. Taxation services have to comply with the tax rules set by the jurisdiction. Often, accountants have to adjust the organization’s financials to account for the differences in the prescribed standards.
This information helps in the calculation of tax liabilities of the company and also in the preparation of tax statements. One of the main aims of doing taxation services is to reduce the company’s tax liability without violating any rules and regulations or laws of the accounting standards.
Forensic Accounting in an organization points out all the fraudulent, loopholes, and liabilities that take place in the financials. It is the process of auditing, analyzing, and examining the financial records of the company to see for any missing statements or illegal activities.
Some of the matters that may require forensic accounting services are personal injury claims, insurance claims, violation of rules, suspected or committed fraud and other such financial issues. Forensic accountants play an important or expert witness in the court of law which requires the proof of financial statements.
This type of accounting service tracks the financial progress of a particular project that the company takes up through regular financial reports. Project accounting plays a crucial role in the evaluation of managerial accounting as they display the progress of an individual’s performance and also the performance of the project. This type of accounting is very beneficial for project-oriented organizations or businesses.
Social accounting is still in the early stages and is developing due to growing environmental and Corporate Social Responsibility Reporting and Sustainability. Social accounting is generally prepared by studying the environmental and annual reports of the organizations. It can also be referred to as the process of evaluating the impact on an organization due to its activities.
Government accounting, as the name suggests, is generally used in the evaluation of financial records of public sectors. It works slightly different from the financial accounting that is used in the private sectors.
They mainly ensure the proper usage of the specified budget and also make sure to fit the expenses accordingly. It also includes the utilization of tax auditing, financial accounting, and other types of accounting services.
Public accounting is a broad are that involves various types of accounting to provide services such as taxation services, consulting services, financial planning services, preparing and issuing financial reports. Public accounting mainly serves clients such as non-profit organizations, manufacturers, businesses, service-oriented companies, and more.