Accounting Principles and Professions

These flashcards cover key concepts, definitions, and terms related to accounting principles and professions.

Accounting

The recording, classifying, summarizing, and interpreting of financial events and transactions in an organization.

Managerial Accounting

Provides information and analysis to managers inside the organization for decision making.

Financial Accounting

Generates financial information and analyses for external parties, including owners and creditors.

Certified Management Accountant (CMA)

A professional accountant who has met educational and experience requirements and passed a qualifying exam.

Certified Public Accountant (CPA)

A professional accountant who has passed a series of examinations and met educational and experience requirements.

Generally Accepted Accounting Principles (GAAP)

Standards that accountants must follow to ensure the financial information is accurate and reliable.

Auditing

The process of reviewing and evaluating the information that companies use to prepare their financial statements.

Tax Accounting

Specialized accounting focused on preparing tax returns and developing tax strategies.

Government Accounting

Accounting practices that support organizations whose purpose is to serve rather than generate profit.

Accounting Cycle

A six-step procedure that results in the preparation and analysis of major financial statements.

Double-Entry Bookkeeping

A system where every transaction is recorded in two places to ensure accuracy.

Trial Balance

A summary of all the financial data in the account ledgers that ensures the figures are correct and balanced.

Financial Manager

Responsible for an organization’s overall financial state, including creating financial reports and directing investments.

Investment Banker

Professionals involved in high-level transactions, mergers, acquisitions, and capital-raising efforts.

Chief Financial Officer (CFO)

Management-focused position responsible for tracking cash flow and ensuring the accuracy of financial reports.