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WHAT IS AN ACCOUNTING ENTITY:?
• Organisational unit
• Accounting records are kept.
• Accounting reports are prepared.
WHAT TYPES OF ACCOUNTING ENTITIES ARE THERE? ...
USERS AND USES OF ACCOUNTING INFO
SHAREHOLDER:
• To buy sell or hold shares
CREDITORS
• To increase reduce or keep constant the level of credit
EMPLOYEES:
• To calim salary increases
• Change emplyement
GOVERNMENT
• Raise taxation
CUSTOMERS
• To buy prodcucts
MANAGERS
• To change pricing
• Cash flow
• Sale trend
GENERAL PUBLIC
• Assess economic and social impact
MONETARY UNIT CONCEPT
• Accountants consider only things that can be expressed in monetary terms
DUALITY
• Assests = liabilities+ OE
• Every transaction atleast 2 effects on the accounting equation
ACCOUNTING ENTITIE CONCEPT
Accountants consider a business to separate and distinct from the owner
LEGAL ENTITY CONCEPT
• Owener and business are seen as one in the case of soletraders and partnerships
GOING CONCERN CONCEPT
• Business has unlimited life
• Continuity
ACCOUNT PERIOD CONCEPT
• Accountants split the life of a business into period for reporting purposes.
Approximate Word count = 430
Approximate Pages = 1.7
(250 words per page double spaced)
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