What is Accounting? Meaning, Key Features and Career

By IIC Lakshya

27 Nov 2025

Others

What is Accounting? Meaning, Key Features and Career

An individual or a business is evaluated by implementing accounting principles in the process of recording, analysing, and reporting the financial transactions. Learn about accounting in finance, the key functions, role in companies, and job opportunities here.

Accounting in Finance

What is Accounting? The financial health of a company or an individual is assessed by evaluating financial statements and tracking performance. Integration of accounting aids in making effective economic decisions for a company. The implementation of the golden rules of accounting helps the financial process become much easier.

All stakeholders of a company, are the management, creditors, and investors, get a transparent report of the company. They learn about their financial conditions, funding, and whether it is appropriate for future investments.

Key Functions of Accounting in the Market

Accounting is an integral part of the management of finance on the individual and organisational level. Stakeholders like management, creditors, and investors get a transparent image of the company, its financial status, and future growth. Wondering what do accountants do? Below are the key or core functions of Accounting in the Market.

Recording

All financial transactions of an organisation are systematically recorded through accounting. It helps keep track of all the transactions, which helps in the sales of the company.

Classification/ Categorisation

The financial transactions are classified or grouped accordingly. Through accounting, the financial information is assessed. In accounting, auditing is significant across the financial process and integration.

Summarization

After the categorisation of the financial statements and the transactions, the classified data is compiled together. The strategic management accounting benefits businesses by reflecting their future growth. The financial statement documents like the balance sheet, cash flow statement, and income statement.

Reporting

The summarisation of financial and managerial accounting is presented effectively. Through meaningful format is reported for analysis, which guides companies towards investment decisions and the growth of the company.

Analysis

The financial summarisation is analysed by interpreting the financial information and statements. The performance of the business is better understood, forecasting the future outcomes, and identifying the financial trends of the market.

How Accounting Plays a Significant Role in Organisations?

Accounting plays an important role in companies as it contributes a lot to the process of recording financial transactions. Students who have pursued the ACCA professional qualification contribute to the company’s growth. Below are some of the significant accounting roles that professionals perform, and help the management perform.

Accountability - Accounting professionals work for an organisation by creating a transparent record of all financial transactions, data, and information. Professionals promote accountability to stakeholders.

Decision-making - Organisations use financial data to develop strategies, make decisions, and execute operational processes. Accounting in companies helps companies in their future planning, investments, and the company’s operations.

Financial Health - With the implementation of accounting in an organisation, companies learn transparency and share it with the public. The assets, liabilities, and profitability are better understood with the accounting of a company. Certified Public Accountant certified professionals help companies in communication and management.

Compliance - In a business, accounting helps ensure that all tax laws and regulations are followed effectively. The professionals working in an organisation evaluate the financial transactions and all data, thus predicting the financial future of the company.

Career Paths in Accounting

Below are the various career positions in Accounting where professionals integrate proficiency in the International Financial Reporting Standards (IFRS), leadership, strong analytical skills, decision-making skills, and problem-solving. Below are some of the significant career opportunities that accounting professionals can apply for.

Junior Accountant/ Bookkeeper - They record the daily transactions and data entry, maintain journals and ledgers, and prepare basic reports like bank statements, receipts, and invoices.

Banking & Finance Officer - It is one of the significant accounting jobs in the market. They prepare financial statements, internal auditing tasks, tax filing assistance, and inventory analysis.

Senior Financial Analyst - Senior accountant professionals budget, forecast, and finalise accounts; hence, it is one of the top finance and accounting careers after graduation. They also plan taxes, internal control evaluations, and prepare management reports.

Accounting Manager - The accounting professional manages the eam, oversees audits, cost control, and strategic budgeting. They also regulate the analysis, planning, and reporting of the companies.

Chief Financial Officer - Professional accountants make investments, presenting the financial performance of the company, along with overseeing the financial operations of the company.

Wrapping Up!

In conclusion, accounting is an integral part of companies and how they perform in the market. Students pursuing accounting as a career through learning advanced finance and business knowledge. In this article, you have been guided into the various career paths that you can pursue after completing the diploma courses in accounting.

Frequently Asked Questions on What is Accounting

What are the 5 principles of accounting?

There are 5 basic accounts, namely, income, asset, liability, equity, and expenses accounts.

What are the three laws of accounting?

There are 3 golden rules of accounting as follows:

Debit what comes in and credit what goes out
Debit the receiver and credit the giver
Debit expenses and losses, credit income and gains

What are the 4 types of accounting?

There are four main types of accounting like management, tax, forensic, and financial accounting.

What is a journal entry?

The journal entry in the accounting process is the first step, where financial statements are recorded.

What is a trial balance?

In a financial statement that lists all the credit and debit balances of the general ledger of a company for a specific time, which ensures all are equal and mathematical accuracy is called a trial balance.