General accounting helps in decision-making by providing information on the financial condition of the company. Financial data such as income statement, balance sheet and cash flow statement is then used for various purposes like planning, forecasting, management, investment analysis and forecasting, tax planning, and valuation analysis among others. It helps in the formulation of corporate policies, strategic planning, decision-making of sales strategy, marketing strategy, etc. In short, general accounting can be defined as the process of collecting, organizing, interpreting, preparing and reporting information about financial transactions of an organization.
General accounts are primarily concerned with the internal control over financial reporting. They involve the formulation of policies and procedures for financial management. This is usually done on a quarterly basis by non-profit organizations, government agencies, corporations, and other companies. The basic function of general accounts is to ensure consistency in accounting practices and to reduce accounting risk.
General accountants are responsible for maintaining the financial records of the company including income statement, balance sheet and statement of cash flows for the previous period, the current period, and the forecast period. The general accountant has the responsibility to ensure that all financial transactions are performed according to plan and by law.
General accountants prepare the general ledger in the name of the business. He is the one responsible for preparing general accounts of the company. General accounts comprise the balance sheet and statement of cash flows. These accounts help the company to make a statement of its finances and to plan for future needs.
General accounts are usually prepared in the name of the business. However, in some cases the accounts have been prepared in the names of the individual or an associate. The general accountants prepare general accounts in relation to the financial condition of the company. This involves setting goals of the company, recording transactions for the past and forecast period, creating strategies for future growth of the company, establishing the financial position of the company, and preparing general statements. from all the reports.
General accounts enable a company to determine its future financial position. and to formulate strategies for future growth of the company. General accounts also enables a company to determine the amount of capital required for its activities, to determine the profit of the company and to calculate the return on its assets and liabilities, etc.
General accountants prepare the financial records of the company based on the general ledger. General accounts of the company include balances, liabilities, assets, net worth, and capital employed, and the gross value of the firm, among others.