Accounting Abbreviations

What is Accounting?

Accounting is the science that designates the totality of numerical records carried out in order to determine and order, in a complete way, all movements, in value and quantities, carried out within the scope of activity of a company or similar entity.

Accounting can be divided into financial and business accounting. Financial accounting comprises all payment transactions between the company and abroad (for example, purchases and sales, banking operations) and which allows the realization of the annual balance sheet for tax and commercial purposes. Business or analytical accounting assumes the use of costing (with its corresponding cost elements, etc.).

A person whose professional field is accounting is known as an accountant. In Brazil, for an individual to receive the title of “Accountant”, he/she must take the Sufficiency Exam of the Federal Accounting Council.

Cost accounting

Cost accounting is an area of business accounting that, unlike financial accounting, encompasses the accounting of all internal costs and benefits, including accounting for facilities, materials, and wages. Cost accounting is for:

• exclude influences outside the company in determining monthly or annual earnings;
• control the company’s profitability, thanks to the inclusion of all types of costs and different productions, and sometimes also with the help of planned cost accounting;
• prepare production and investment planning;
• obtain the data necessary to close the business and fiscal year.

In the field of general accounting, cost accounting may or may not be linked to financial accounting.

Public accounting

Public accounting concerns the systematic recording of financial transactions carried out by all public sector bodies.

Management accounting

Management accounting is the area of accounting through which one seeks to establish and determine the future development of a company. It has a strong strategic planning component. The starting point is usually the sales plan, from which the production (cost) plan, supply plan and financing plan derive.

Tax accounting

Also known as tax accounting, tax accounting is the area of ​​application of accounting sciences that aims to determine and reconcile the generation of taxes of a particular entity. Tax accounting provides important data for the calculation of taxes.

List of Acronyms Related to Accounting