- Financial
- Economic
- Legal
- Fiscal
- Social
Let's specify them more closely:
- Financial function:
Accounting is used as a means of assessing the financial situation of the company. Indeed, it provides after analyzing the situation, information assisting in the economic decision making.
- Economic function:
This function is located both at the micro and macroeconomic levels.
Microeconomic level:
Promotion of production by providing an objective basis for decision for investors and lenders, and information needed for management.
Macroeconomic level:
Instrument of knowledge of the national economy's trend and direction of the nation's economic policy.
- Legal function:
The legal basis of accounting derives directly from the obligation of bookkeeping. Its main objectives are:
- Information provided to third parties on the assets of the company
- Evidence in litigations
- Relationship of trust between partners
- Fiscal function:
The obligation of bookkeeping is to provide the tax administration with a reliable and continuous base for determination and control of business results with regard to their imposition. Hence, accounting fulfills a purely fiscal function to protect the interests of the tax administration.
- Social function:
Bookeeping can provide useful information for assessing the social policy of the company.
Such information can include:
- Payroll served
- Social expenditures supported
- Benefits and premiums
- Expenditures on staff training
Subscribe to this comment's feed