Lakhasly

Financial Accounting: Financial accounting in the original form of accounting, which is basically confined to the preparation of financial statements for the external users.It refers to information describing the financial resources, obligations, and activities of an economic entity, whether it is an organization or an individual entity.Conventionally, accountants use the term financial position to describe an entity s financial resources and obligations at one point in time or given data, and the term results of operations to describe or portray the entity s financial activities during the year a part of year.Moreover, many other decision makers also make a fundamental use of financial accounting information.

Financial Accounting:
Financial accounting in the original form of accounting, which is basically confined to the preparation of financial statements for the external users. It is usually interested in providing general purpose information. It refers to information describing the financial resources, obligations, and activities of an economic entity, whether it is an organization or an individual entity. Conventionally, accountants use the term financial position to describe an entity s financial resources and obligations at one point in time or given data, and the term results of operations to describe or portray the entity s financial activities during the year a part of year. Basically, financial accounting information is intended and designed to help investors and creditors decide where to place their scare investment resources (FASB, 1999).
Such decisions are of great importance to any society, as they determine which enterprise and industries will receive the available financial resources necessary for economic growth. Moreover, many other decision makers also make a fundamental use of financial accounting information. For example, an enterprise s managers and employees constantly need such information in order to run and control dayto-day business operations. Financial accounting information also is important for preparing income tax return or declaration. In short, financial accounting information is used to serve too much different purpose that it often is called general purpose accounting information.