When you start a business, you’ve suddenly got all kinds of new responsibilities. It’s important to keep track of your company’s finances. From providing an overall snapshot of your business’s financial health to simplifying your annual tax filing, accounting can help provide the information you need. Generally, accounting is the work or process of keeping financial records. It is the systematic recording, reporting, and analysis of the financial activity (transactions) of a person, business, or organization. In business, it allows companies to analyze their financial performance.
Additionally, accounting allows businesses to examine their results regarding profits, losses, productivity, sales trends, costs, etc. It tells you whether or not you’re making a profit, what your cash flow is, what the current value of your company’s assets and liabilities is, and which parts of your business are actually making money. The main goal of accounting is to accurately record and report an organization’s financial performance.