What ties all businesses together, no matter what they deal with? Accounting, of course it is literally the backbone of every business. Solid, professional accounting gives a business a clear image of where it is at this moment, and lets the financial managers make informed choices on the future of the business. Accounting is also a profession that dates back literally thousands of years. Evidence of accounting procedures even date back as far as the days of the Pharaohs and Ancient Egypt.
The root of accounting actually is bookkeeping, no real surprise there, though many people do not think about it much. What a bookkeeper does is track all of the money that the business handles, both incoming and outgoing. A bookkeeper ensures that the books are balanced properly, and the records are clear and in order. A bookkeeper also handles information regarding payroll, bank statements, ledgers, and even information regarding real estate and investments the company itself has.
Another aspect of accounting is auditing, which protects the employees, owners, and investors of a company from any sort of accounting fraud or mistake. An audit is usually performed by an outside company to maintain a lack of bias. What an accountant does during an audit is go through all of the financial records of the company, including the ledgers, to figure out an accurate financial picture of the company. If the ledgers the company holds do not match the bank statements, then the accountant realizes that there is something wrong and it is their job to figure out what. Sometimes this means discovering that someone has been helping themselves to company funds, but other times can just be correcting a harmless error.
Yet another part of being an accountant is compiling and analyzing the company’s financial situation, and creating reports based on this to be distributed throughout the company. With these statements, along with personal dealings, the accountant can give recommendations on investments, if the company can afford the direction it desires to go in, and more. Part of this also includes reporting to various government agencies.
So, how many accountants does one company have? It depends on the company, no surprise there. Most of the time, the main accountants are certified public accountants, who have to pass a test given to them by the state in order to work as an accountant. A business will often also employee bookkeepers, and the accountants can oversee accounting training. Most of the time, a single accountant will oversee the entire department and this role is vital to the company, as this is usually the person that meets with investors as well as the companies head, and is responsible if anything goes wrong.