Definition Nature Function and History of Accounting
Definition Nature Function and History of Accounting
Definition Nature Function and History of Accounting
DEFINITION, NATURE,
FUNCTION AND
HISTORY
LAWRENCE J M. MARCELLA, CPA
Accounting is a service activity. Its function is to
provide quantitative information, primarily
financial in nature, about economic
entities, that is intended to be useful in making
economic decision.
- Accounting Standards Council (ASC)
Accounting is the art of recording, classifying
and summarizing in a significant manner and in
terms of money, transactions and events
which are in part at least of a financial character and
interpreting the results thereof.
- American Institute of Certified Public Accountants (AICPA)
Accounting is the process of identifying,
measuring, and communicating economic
information to permit informed judgment and
decisions by users of the information.
FINANCIAL
ART (IN
NATURE)
PROCESS
TIME
EVENTS
PERIOD
The first income tax law in the Philippines is
1913
enacted.
The first Accountancy Law , Republic Act (RA)
1923 3105 in the Philippines was passed. This law
created the Board of Accountancy (BoA).
The Accountancy Law was revised and passed
1967
under RA 5166.
In the Philippines, the Accountancy Law was
1975 revised and passed under Presidential Decree
No. 692
KEY DATES IN ACCOUNTING REVOLUTION – PH SETTING
TIME PERIOD EVENTS
Philippine Institute of Certified Public Accountant (PICPA) created
the Accounting Standards Council (ASC) to establish and improve
1981
the generally accepted accounting principles (GAAP) in the
Philippines.
The Philippines started transitioning from applying American-
1997 based accounting standards to applying International Accounting
Standards (IAS).
SUMMARIZING
• Refers to the preparation of financial statements.
THE ACCOUNTING PROCESS
Analyzing the
Preparing the Preparing the
business
financial closing
documents or
statements entries
transactions