Importance of Accounting in the Company

The accounting in the company is a necessary process that serves to know the patrimonial states of the same. It is practically impossible to have a reasonable management of an organization without knowing exactly its numbers and patrimonial circumstances, its relationships between assets and assets. This circumstance is true both for a large company and for a micro entrepreneurship, although it is true that in the second case there may be a very rudimentary record. The accounting in the company it is carried out conscientiously by specialists and is essential to evaluate the decisions that will be made in the future. In professional terms, the double entry system is still used.

When making decisions of an economic nature, it is extremely important to keep a good follow-up that accounts for the situation in which an organization or a person find themselves. This circumstance led to the development over time of different ways of monitoring different types of scenarios. Indeed, each town had a way of recording their harvests, their consumption, etc. The development of a unit of account was enormously important in this sense, because it facilitated the records that were carried out. Accounting as we understand it today was a refinement of this entire process, a refinement that arrived in the Middle Ages and was definitively imposed in the

Renaissance. Of course there were huge changes in this system as well, but the beginning of the same are maintained.

A company, on the other hand, has the purpose of obtaining profitability. To achieve this objective, the prices of goods and services in the market are observed and an attempt is made to produce them at a lower cost. The difference between these prices and the costs will be the so-called profitability of the company. Now, despite the fact that these considerations are easy to understand, the truth is that a follow-up is required. exhaustive analysis of these values, a follow-up that can only be carried out through a detailed record of all the transactions, of all the decisions that are made and that imply the exit and entrance of money. This is how accounting is constituted as a fundamental tool in a company to carry out its objectives.

Surely with the passage of time the current accounting system will be modified. Indeed, existing changes in society can lead to evaluating new forms of registration that faithfully reflect them, the accounting in the company It will surely improve in this regard.