The role of an accountant is very important for a firm to perform well and be financially stable. Accountants can belong to both the public and private sectors. They can perform various roles like managerial, technical or even advisory. They also analyze the financial records formed by the bookkeepers to prepare financial statements and thus to perform financial analysis. It is also important to perform functions like recording, classifying and summarising. An accountant can be a bookkeeper or an adviser for financial management. These are some of the functions performed by an accountant. A detailed analysis is given below:-
Preparation of financial reports
According to the financial data compiled, the accountants prepare the financial statements or accounting statements which will have monthly and annual reports. The documents included in this are the quarterly and year ending details.
Maintaining the book of accounts
It is of utmost importance to have the systematic records of the financial transactions to be maintained by the accountant. This is to get the correct profit and loss suffered by the company. The future planning and growth of the company also depend on the book of accounts.
Before occurrence, certain transactions and activities are planned this is referred to as Budgeting. It is important to balance income and expenses. While preparing the budget the role of an accountant is very relevant.
Analysing and advising
In making certain business decisions accountants use financial data for analysing. They handle much financial analysis on a daily basis. Solving any discrepancies caused by finance has to be dealt with by the Accountant.
In certain cases the accountant will have to carry an investigation on the financial position of some parties. External professionals can also be included in this task and add to the confidentiality of the report.
Under various laws, the accountants can file returns, settle tax liabilities, manage tax matters, before the tax authorities can make representations, etc
A chartered accountant can audit various companies’ books of entities and also ensuring that financial statements represent the right financial position of an entity.
The different types of accountants include:-
- Financial accountant
- Cost accountant
- Chartered accountant
- Forensic accountant
- Public accountant
- Management accountant
- Tax accountant