The term accounting is related to the process of documentation of transactions related to business. This process comprises of summary, analysis of the summary and reporting these transactions to outside agencies such as regulatory agency and tax collector agencies. Prime financial agencies are three types such as:
- Financial statements produced by accounting,
- The income statement,
- Cash flow statement and balance sheet
Financial accounting is the process of recording and communication of information in line with GAAP, or Generally Accepted Accounting Principles and is primarily have external users. The five prime principles of accounting consist of:
- Revenue Recognition Principle,
- Historical Cost Principle,
- Matching Principle,
- Full Disclosure Principle, and.
- Objectivity Principle.
What is SAP?: It is a software commonly called as SAP accounting software used in carrying out financial accounting and reporting of :
- Monthly or quarterly reporting of operating data
- Analysis of financial data.
Modules of the SAP accounting software comprise of accounting, report writing, receivable account management and others. In the instant of your purchasing material, which is applied in producing a definite product and inventory management, account assignment shall be maintained in SAP using automatic account calculation and there will be no need of account assignment at the time of PO.
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