Editing Accounting (section)

== Topics ==
Accounting has several subfields or subject areas, including [[financial accounting]], [[management accounting]], [[auditing]], [[taxation]] and [[accounting information system]]s.<ref name = "WC 1981">Weber, Richard P., and W. C. Stevenson. 1981. "Evaluations of Accounting Journal and Department Quality." The Accounting Review 56 (3): 596–612.</ref>

===Financial accounting===
{{main article|Financial accounting}}
Financial accounting focuses on the reporting of an organization's financial information to external users of the information, such as investors, potential investors and creditors. It calculates and records business transactions and prepares [[financial statement]]s for the external users in accordance with [[generally accepted accounting principles]] (GAAP).<ref name = "HDF 2006">{{Citation
 | last1 = Horngren
 | first1 = Charles T.
 | author-link1= Charles Thomas Horngren
 | last2 = Datar
 | first2 = Srikant M.
 | author-link2= Srikant Datar
 | last3 = Foster
 | first3 = George
 | title = Cost Accounting: A Managerial Emphasis
 | place = New Jersey
 | publisher = Pearson Prentice Hall
 | year = 2006
 | edition = 12th
}}</ref> GAAP, in turn, arises from the wide agreement between [[accounting research|accounting theory]] and practice, and changes over time to meet the needs of decision-makers.<ref name = "NP 2013" />

Financial accounting produces past-oriented reports—for example financial statements are often published six to ten months after the end of the accounting period—on an [[Annual report|annual]] or quarterly basis, generally about the organization as a whole.<ref name = "HDF 2006" />

===Management accounting===
{{main article|Management accounting}}
Management accounting focuses on the measurement, analysis and reporting of information that can help managers in making decisions to fulfill the goals of an organization. In management accounting, internal measures and reports are based on [[cost–benefit analysis]], and are not required to follow the generally accepted accounting principle (GAAP).<ref name = "HDF 2006" /> In 2014 CIMA created the [https://www.cgma.org/resources/reports/globalmanagementaccountingprinciples.html Global Management Accounting Principles (GMAPs)]. The result of research from across 20 countries in five continents, the principles aim to guide best practice in the discipline.<ref name=FT>{{cite news|last=King|first=I.|title=New set of accounting principles can help drive sustainable success|newspaper=Financial Times|date=23 October 2014|url=http://www.ft.com/cms/s/0/0b595a98-59fa-11e4-8771-00144feab7de.html?siteedition=uk#axzz3Q8Lp1OP9|publisher=ft.com|access-date=28 January 2015}}</ref>

Management accounting produces past-oriented reports with time spans that vary widely, but it also encompasses future-oriented reports such as [[budgets]]. Management accounting reports often include financial and non financial information, and may, for example, focus on specific products and departments.<ref name = "HDF 2006" />

===Intercompany accounting===
{{main article|Intercompany accounting}}
Intercompany accounting focuses on the measurement, analysis and reporting of information between separate entities that are related, such as a parent company and its subsidiary companies.  Intercompany accounting concerns record keeping of transactions between companies that have common ownership such as a parent company and a partially or wholly owned subsidiary. Intercompany transactions are also recorded in accounting when business is transacted between companies with a common parent company (subsidiaries).<ref>{{Cite web |title=What is Intercompany Accounting? {{!}} F&A Glossary {{!}} BlackLine |url=https://www.blackline.com/resources/glossaries/intercompany-accounting/ |access-date=2024-08-16 |website=www.blackline.com}}</ref><ref>{{Cite web |last=Beaver |first=Scott |date=2024-04-03 |title=What Is Intercompany Accounting? Best Practices and Management |url=https://www.netsuite.com/portal/resource/articles/accounting/intercompany-accounting.shtml |website=www.netsuite.com}}</ref>

===Auditing===
{{main article|Financial audit|Internal audit}}
Auditing is the verification of assertions made by others regarding a payoff,<ref name = "B 1979">Baiman, Stanley. 1979. "Discussion of Auditing: Incentives and Truthful Reporting." Journal of Accounting Research 17: 25–29.</ref> and in the context of accounting it is the "[[wiktionary:unbiased|unbiased]] examination and evaluation of the financial statements of an organization".<ref name = "I 2013">{{cite web |url=http://www.investopedia.com/terms/a/audit.asp |title=Audit Definition |year=2013 |website=Investopedia |publisher=Investopedia US |access-date=30 December 2013 |archive-date=26 July 2022 |archive-url=https://web.archive.org/web/20220726065345/https://www.investopedia.com/terms/a/audit.asp |url-status=live }}</ref> Audit is a professional service that is systematic and conventional.<ref>{{cite journal|last1=Tredinnick|first1=Luke|title=Artificial intelligence and professional roles|journal=Business Information Review|date=March 2017|volume=34|issue=1|pages=37–41|doi=10.1177/0266382117692621|s2cid=157743821|url=http://repository.londonmet.ac.uk/3812/3/OOTB-AI.pdf |archive-url=https://ghostarchive.org/archive/20221009/http://repository.londonmet.ac.uk/3812/3/OOTB-AI.pdf |archive-date=2022-10-09 |url-status=live}}</ref>

An audit of financial statements aims to express or disclaim an independent opinion on the financial statements. The auditor expresses an independent opinion on the fairness with which the financial statements presents the financial position, results of operations, and cash flows of an entity, in accordance with the generally accepted accounting principles  (GAAP) and "in all material respects". An auditor is also required to identify circumstances in which the generally accepted accounting principles (GAAP) have not been consistently observed.<ref name = "SAS 1 Responsibilities">{{cite web |url=http://www.aicpa.org/Research/Standards/AuditAttest/DownloadableDocuments/AU-00110.pdf |title=Responsibilities and Functions of the Independent Auditor |date=November 1972 |website=AICPA |access-date=30 December 2013 |archive-date=23 April 2021 |archive-url=https://web.archive.org/web/20210423141039/https://www.aicpa.org/Research/Standards/AuditAttest/DownloadableDocuments/AU-00110.pdf |url-status=dead }}</ref>

===Information systems===
{{main article|Accounting information system}}
An accounting information system is a part of an organization's [[information system]] used for processing accounting data.<ref name=OpenLearn>{{cite web|title=1.2 Accounting information systems|url=http://labspace.open.ac.uk/mod/resource/view.php?id=365833|work=Introduction to the context of accounting|publisher=OpenLearn|access-date=3 February 2014}}</ref>
Many corporations use artificial intelligence-based information systems. The banking and finance industry uses AI in fraud detection. The retail industry uses AI for customer services. AI is also used in the cybersecurity industry. It involves computer hardware and software systems using statistics and modeling.<ref>{{cite journal|last1=Pathak|first1=Jagdish|last2=Lind|first2=Mary R.|title=Audit Risk, Complex Technology, and Auditing Processes|journal=EDPACS|date=November 2003|volume=31|issue=5|pages=1–9|doi=10.1201/1079/43853.31.5.20031101/78844.1|s2cid=61767095}}</ref>

Many accounting practices have been simplified with the help of [[accounting software|accounting computer-based software]]. An [[enterprise resource planning]] (ERP) system is commonly used for a large organisation and it provides a comprehensive, centralized, integrated source of information that companies can use to manage all major business processes, from purchasing to manufacturing to human resources. These systems can be cloud based and available on demand via application or browser, or available as software installed on specific computers or local servers, often referred to as on-premise.

===Tax accounting===
{{main article|Tax accounting}}
Tax accounting in the United States concentrates on the preparation, analysis and presentation of tax payments and tax returns. The U.S. tax  system requires the use of specialised accounting principles for tax purposes which can differ from the [[generally accepted accounting principles]] (GAAP) for financial reporting.<ref name="autogenerated2010">{{ Citation | last1 = Droms| first1= William G.| last2= Wright| first2= Jay O.| title= Finance and Accounting for nonfinancial Managers: All the Basics you need to Know| publisher= Basic Books| year= 2010| edition= 6th}}</ref> U.S. tax law covers four basic forms of business ownership: [[sole proprietorship]], [[partnership]], [[corporation]], and [[limited liability company]]. [[Corporate tax in the United States|Corporate]] and [[Income tax in the United States|personal]] income are taxed at different rates, both varying according to income levels and including varying marginal rates (taxed on each additional dollar of income) and average rates (set as a percentage of overall income).<ref name="autogenerated2010"/>

===Forensic accounting===
{{Unreferenced section|date=June 2023}}
{{main article|Forensic accounting}}

Forensic accounting is a specialty practice area of accounting that describes engagements that result from actual or anticipated disputes or [[litigation]].<ref>{{Cite web |title=What is a Forensic Accountant? {{!}} Forensic CPA Society |url=https://www.fcpas.org/about-us/what-is-a-forensic-accountant/ |access-date=2023-08-02 |language=en-US}}</ref> "[[Forensic science|Forensic]]" means "suitable for use in a court of law", and it is to that standard and potential outcome that forensic accountants generally have to work.

=== Political campaign accounting ===
{{main article|Political campaign accounting}}
Political campaign accounting deals with the development and implementation of financial systems and the accounting of financial transactions in compliance with laws governing political campaign operations. This branch of accounting was first formally introduced in the March 1976 issue of ''The Journal of Accountancy''.<ref>{{cite journal |id={{ProQuest|198258865}} |last1=Wagman |first1=Barry E. |title=Political campaign accounting—New opportunities for the CPA |journal=Journal of Accountancy |volume=141 |issue=3 |date=March 1976 |pages=36 }}</ref>