Question

Assignment 1/ACT 140 Answer the two questions given below by giving introduction, discussion/analysis and conclusion. This assignment will be done in a group of two students, where one student will answer only one question (either question no. 1 or 2) 1] A. Explain the role of financial accounting in the society (government, investors and creditors) by giving detailed justification and suitable examples. B. Differentiate the role of financial accounting with that of managerial accounting. 2] Discuss the importance of ethics in accounting jobs and how unethical practices from accounting firms can damage the society. *** Please write the name of the student for each question answered **Write proper APA in-text citations and list of references at the end. *Submission date is 3 July. Only one student in the group will do the uploading of the assignment.

Answer 1

Explain the Role of financial Accounting in the society (government , investors and creditors) by giving detailed justification and suitable examples.

Role of Financial Accounting

Financial Accounting is attached with reporting the results and position of the business to persons and authorities other than management - Government, creditors, investors owners etc. Financial Accounts are kept in such a way to meet the requirements of various statutes. Organizations are required to submit financial information to different governement agencies . For example: Publicly owned companies who are listed in stock exchange are required to submit annual financial reports to Securities and Exchange Commisision. In addition, the companies are also required to submit financial report to local, state, and federal tax agencies.

There are number of users who are interested in comapny's financial information.. For example: creditors may wanted to know to whom company sells goods, and when the company faces trouble paying bills.

Employees and labor unions are also interested in the sense as the salaries and other forms of benefits are directly related to financial performance of the company.

Difference Between Financial Accounting and Management Accounitng

Financial Accounting	Management Accounitng
Financila Accounting deals with the business transactions and events for the enterprise as a whole.	Management Accounting , in addition to study of events in relation to enterprise as a whole takes organization in its various units and segments and trace the impact and effect of the business transaction and events through its various divisions and sub-divisions.
Financial Accounting is connected with reporting the results and position of business.	Management Accounting is connected more with generating information for the use of internal management.
Financial Accounting is historical in nature and is more precise than management accounting data.	This provides the necessary rapidity to the management accounting information.

Importance of Ethics in Accounting Jobs and how unethical practices can damage society

A key feature of profession is to comply with set of ethical guidelines. If the ethical standards are not followed, this may decline their trustworthiness and judgment.

Ethical codes are the fundamental principles that accounting professionals should abide by. This helps in increasing their profession, maintain public trust, and demonstrate honesty and fairness. Confidentiality is also to be maintained by the professionals

Ethics and independence are interrelated concepts in accounting profession. An important element of trust and honesty is making decisions that are clear and helps the client in positive way. Examples of conflicts of interest may be demand exposure under independent guidelines. So, getting benefit from sale of one product to recover loss of another product could lead to bias.

To ensure integrity, a professional should be straightforward and honest in every business relationships. This also requires that accountant should be independent and does not associate himself with any transacion that leads to information which is materially false or misleading.