Accounting is basically a term that can also be referred to as accountancy, and it is described as the processing, communication and the measurement of financial details and information about the various economic entities. Examples of the economic entities include federal agencies, corporations, business companies, hospital, and municipalities. Accountancy is basically the language of business, for it is designed to measure the outcomes or results of the organization’s economic activities and it can bring or convey the details or information to different users, like management, creditors, regulators, and investors. The various fields of accountancy include the cost accounting, the tax accounting, the financial accounting, the external auditing, and the management accounting.
Accountant is the term used by the people to call the practitioners of accountancy. The common duties and responsibilities of a licensed accountant include recording financial transactions and preparing pertinent adjustments, processing collections and invoice, processing payments, compiling and reviewing source documents that can support financial transactions, maintaining inventory records and assisting in the count of the inventory, filing tax returns and payment of the corresponding taxes through manual method or through the use of electronic devices, preparing tax returns, preparing statutory and some other reports, and preparing financial reports and the supporting schedules. Most of the licensed accountants can be found working under on an accounting firm.
Accounting firm is the term that refers to companies that are composed of accountants and it specializes in providing various accounting services to their clients. The four major types of accounting firms include the forensic accounting firm, the bookkeeping accounting firm, the public accounting firm, and the tax accounting firm. The bookkeeping firms are established to complete the important and fundamental accounting services and tasks to the business companies that are small and medium in size, and this are defined as firms that are composed of few employees, typically called as bookkeepers. The firm that is designed to employ CPAs or certified public accountants that may work in different areas of accounting, like audit, management and tax consulting, is called as the public accounting firm. The tax accounting firm is said to focus more on tax planning and tax preparation for the companies in different sizes, as well as to individuals who needs their accounting services. The firm that practices their accounting skills and uses legal policies to solve and uncover any criminal activities and fraud by checking or investigating financial reports or records is called as the forensic accounting firm. Some of the common services offered by accounting firms include bill paying services, payroll and sales taxes, business management, accounting assistance, bookkeeping, employee benefits consulting, general business consulting, budgeting and forecasting, business start-up consulting, financial assessment reports, general ledger review, financial statement preparation, income tax preparation and compliance, income tax planning and consulting, annual and quarterly financial reporting statements, and implementation of new accounting software packages.