Page 15 - Accountancy_F5

Exercise 1.1 to-day financial transactions, such
1. What aspects of accounting are most as recording sales, purchases, and
crucial to a business enterprise, and payments, ensuring that Manka’s
how would you explain them to financial records are accurate and
someone who is unfamiliar with the up-to-date.
FOR ONLINE READING ONLY
concepts and theories of accounting? Required: Discuss how the roles of
2. Manka was worried that, poor state of Rehema and Kijigoo will influence
her small business financial records the performance of Manka’s business.
will affect her overall business Branches of accounting and
performance. Therefore, she hires two their general objectives
LANGUAGE EDITING
professionals: an accountant and a There are several branches of accounting,
bookkeeper. The accountant, Kijigoo, which have emerged due to changes in
was responsible for providing economic and business development. In
financial analysis, interpreting data, other words, the demands of accounting
and offering strategic advice to help information evolved to suit the needs and
Manka make informed business objectives of different classes of people.
decisions. On the contrary, the Conventionally, there are three branches
bookkeeper, Rehema, handled day- of accounting as presented in Figure 1.1.

Branches of Accounting

Financial Cost Management
Accounting Accounting Accounting

Figure 1.1: Conventional classification of accounting

Financial accounting: It is concerned One of the distinctive features of financial
with recording of financial transactions and accounting is that, accounting records and
eventually reporting of financial statements financial reporting are closely guided by
that show the performance (profit or loss) well-established accounting standards,
over a span of time/period and financial known as the International Financial
position of the business (assets, liabilities Reporting Standards (IFRS), which were
and capital) as on a particular date. This is adopted by Tanzania in July, 2004. The
usually done at the end of accounting period. information produced under financial

Student’s Book Form Five
2

23/06/2024 17:34
ACCOUNTANCY_DUMMY_23 JUNE.indd 2
ACCOUNTANCY_DUMMY_23 JUNE.indd 2 23/06/2024 17:34