In the current period of strong economic integration, more and more businesses appear operating in different fields, creating a fiercely competitive market that requires businesses to ensure their survival opportunities. and long-term development must have strong internal strength. Finance and accounting are two branches that play important roles in businesses, helping businesses carry out management activities, monitor cash flow, and financial-related issues. To better understand the roles and responsibilities of these two professions, you and NEWSLAX will learn what finance and accounting is through the article below.
What is finance – accounting in business?
Accounting is the job of recording, receiving, processing and providing information about the economic and financial activities of an organization, business,…
From there, it provides information about all assets, sources of asset formation and asset movements in businesses and organizations to help the Board of Directors make socio-economic decisions and evaluate the effectiveness of activities. operating in the business.
Corporate finance is important tools and tasks in the financial system of a business. Activities related to raising capital and using that capital to invest in assets in the business to create profits for business owners.
Based on the financial information of the business, the corporate financier will manage the cash flow in the business to serve activities that create profits for the business.
Financial activities will be directly related to investment decisions, capital source decisions and profit distribution decisions. The common goal of those decisions is to help maximize value for the business.
If accounting is the department that performs the task of synthesizing revenue, calculating specific numbers for all financial revenue and expenditure activities, circulating cash flow, monitoring and paying bills,… then the department The finance department is the unit that receives those numbers to analyze and predict in addition to the budget to ensure maximum efficient exploitation of capital resources. From there, consult and propose to the Board of Directors solutions on costs in projects, capital investment, etc., supporting all activities related to finance.
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The role of finance and accounting in businesses
Finance and accounting are two indispensable activities in any organization in the business world today. Finance – accounting performs the following tasks:
- Timely and complete accounting of all types of assets, equity, liabilities,…
- Financial revenue and expenditure activities
- Helps businesses predict financial needs, support business planning and corporate financial accounting activities
Thereby, finance – accounting is responsible for accounting economic operations arising in the enterprise quickly, promptly, fully and accurately, ensuring good service for all business activities of the enterprise.
These two departments also coordinate with relevant departments to support business planning, annual and multi-year financial plans for the company. In addition, finance and accounting also take on the role of managing financial investment, lending and debt repayment at businesses.
Finance and accounting are two departments where the Board of Directors advises many ideas to direct implementation. Sometimes this department also replaces leaders to directly inspect and supervise the management and compliance with financial and accounting regulations.
The information analyzed by the finance and accounting department is continued to be researched before proposing to the Leaders measures to manage business activities, ensuring good compliance with current regulations and in accordance with the characteristics, business situation of the unit to achieve the highest efficiency.
Therefore, the personnel in these two departments are also workers with good knowledge and skills to support the Board of Directors to develop the business more and more strongly.
The job of an accountant in a business
Accounting work is divided into many types, in which according to the function of providing accounting information, it is divided into financial accounting and management accounting.
Financial accounting is responsible for recording and synthesizing data reflecting the business status of the enterprise through financial reports to serve the information needs within the enterprise and interested units outside the enterprise. . Information needs to ensure consistency, objectivity, and comply with current principles, standards and regimes prescribed in each country’s accounting regulations.
Specific tasks of financial accounting:
– Provide information about revenue and issues related to cash flow in the business activities of the enterprise
– Calculate taxes and income.
– Implement and monitor internal finances, prepare and handle all financial procedures in the enterprise
– Is a logistics unit performing budget preparation and project development. Coordinate with the finance department in the business (if any) or directly analyze finances, find the cause of decreased profits and propose solutions to increase profits by promoting the highest possible revenue for the business. , organization.
– Perform other tasks as directed by the business Board of Directors
Management accounting is the collection, processing, analysis and provision of information about the economic and financial situation based on management requirements to make economic and financial decisions within the scope of management. accounting department.
Management accountants do not undertake data collection but mainly focus on making decisions related to accounting operations, especially decisions related to:
– Production and business factors include purchasing decisions, use of labor objects – inventory, management and control of labor materials which are fixed assets and also the recruitment task. employment and wages for workers,…
– Costs and product prices: management accountants play a part in product pricing, cost classification, cost estimating, cost allocation, and participation in decision-making situations. Management decisions take place within the enterprise,…
– Control and resolve business debts
– Management of financial investment activities
– Participate in the management of other activities of the enterprise
Management accounting information is not only information that has occurred in the past but also includes plans, estimates, estimates, etc. for the future.
The job of a financial officer
Corporate finance includes the tasks of reading financial reports, financial planning and managing financial options, of which the specific tasks are as follows:
– Read financial reports from the accounting department, focus on recording information in the profit and loss statement that shows the business’s revenue and profit.
– Read cash flow reports, which provide information about how cash funds in the business increase or decrease over time.
– Through the balance sheet, it will clearly show how the business’s profits and losses occur
– Strategic planning provides businesses with a financial foundation to help implement projects and plans within the allowable scope of financial resources.
For example, when a business wants to deploy a new product marketing strategy to the market, corporate finance will help the business know how much it needs to pay and then predict and calculate the number of new products. You must sell to cover the initial costs of launching the product. That is the basis for businesses to recoup their expenses.
– Manage financial options: for example, when a business has financial difficulties, staff in this department will help the business understand and offer financial options such as loan levels suitable for repayment capacity. in the company, interest and principal,…
Difference between finance and accounting in business
Based on the analysis of accounting and finance work, accounting can be considered a part of finance, accounting has a narrower scope of coverage than finance.
– Accounting is an essential part of finance, accounting information provides the finance department to analyze the financial situation and business activities in the enterprise.
– The data in financial reports helps the finance department analyze previous activities and guide future plans.
– Accounting performs the job of determining the capital balance and activities that change the capital source such as income, expenses, etc. while finance determines the capital balance based on cash turnover.
– Accounting has the purpose of collecting and presenting financial information, the accountant’s job is to continuously update data both past and present, and the finance department relies on the collected information. for financial strategy planning, management and control, and decision making.
Current accounting software
Currently, accounting software is very popular, easy to use, and multi-functional to support accounting work and bring many benefits to businesses.
The software helps synthesize, store, and analyze the company’s changing situation. In addition, managers can update the business situation to make timely adjustments. Accounting software also helps present data more intuitively and vividly, such as using charts to show a business’s monthly revenue.
Newslax currently provides modern, advanced standard or customized accounting software according to business needs. Our Newslax accounting software helps businesses:
Better cash flow management: manage all cash flow activities
Store and look up your unit’s accounting data quickly and easily
Transfer accounting data easily when there is a change in personnel in the company
Easy to use, ensures safety and data security.