25 October 2009
Accounting in Everyday Life
As long as there will people in this world, there will be business, and as long as there is business, there will be accounting. Accounting is involved in virtually everything in our lives whether we know it or not, and its importance can sometimes be overlooked. Everything needs accounting. From a baseball cap you wear, to the food you eat, to the company you work for, or even the music you hear on the radio, accounting is needed and was involved in all of those things steps of production or operation.
An accountant measures, aggregates and reports financial information necessary for the sake of decision making by organizational managers, owners, investors, government agencies and other users. From the previous statement, we can see the indication that shows how accounting is important in careers. Everything needs accounting. Whether you are a doctor, or an ordinary office worker, you would still need to play with numbers and take into account the cost of things that you used or used by someone else. Timely and accurate information on operations is crucial to success in the recent days of rapidly changing business environment, and the accountant is the one responsible for the critical business function that mostly though indirectly affects our career and everyday life.
In the career perspective every occupation must carefully manage their money, their cash inflows and outflows. Jobs such as independent contractors have to analyze how much the job is going to cost them and how much they are going to charge for the job. They must track all their expenses and estimates in order to not under cost and to charge appropriate prices. In simplest form, this is accounting. If not accurately tracked and estimated, that contractor’s business will not profit and eventually go out of business. Same thing goes for big business, if that company or firms does not accurately handle the operations of its cash flows, it will not sustain for long. More and more today employees such as secretaries and receptionists are being taught basic accounting practices to help aid the accountants and to keep proper bookkeeping. This way these employees can manage the lower importance items of a business and leave transactions of higher significance to the accountant to analyze and interpret for decision making purposes.
In one’s life, can we say accounting will promote a better lifestyle? I say, definitely yes. The management and control of personal finance is a subject of immense importance today to people. In the world that we lived in today, there is barely a single person who lives without a single debt in their life. Debts ranging from credits cards, car payments, mortgages, and so on, one can find themselves stuck in economic hardships that in some cases destroy lives and has become wake-up calls to many people. Wouldn’t it be nice to know exactly where the increases and decreases are coming from and going to, respectively, to whatever degree of detail you need? Of course it would be. Many of us spend without much thought on the impact of the action. It is essential on knowing the proportions being spent on the basic necessities and luxuries and how to have that proper balance across our expenditure. Life is not as easy as driving on the road with traffic lights and signs along the way, but we still need financial signals in our life whether we are in a comfortable phase or in the danger phase that requires help. Accounting can help people detect these dangers. If not much, the least it can do is ensure that your debt is under control and manageable.
Handling all the calculations of accounting can be tedious and bothersome but can make all the difference one’s finances. You can strategically plan ahead to save for your retirement, your children’s college fund, or luxury or two later down the road. We can see the importance of this concept by noticing companies today whose operations are strictly financial advising. It can be concluded that in the era that we are living in today, Families, and retirees depend on the credibility of financial reporting for their futures and livelihoods. With financial pressure amounting in many peoples’ lives, accounting is seen as important in so many ways that it is almost impossible to live without it.