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What Is Accounting and Should You Pursue It?

What is accounting about? What are the different types of accounting? Should you consider studying it? We explain all about it here!

Do you enjoy working with numbers? What are the jobs available in accounting? Do you see yourself taking up a seat in one of the Big Fours? Perhaps the accounting field has piqued your interest but you aren’t sure what accountancy actually entails. We’re here to help!

At the end of this article, you’ll get a clearer picture of accountancy to help you make a more informed decision about whether a career in the field is up your alley.

1. What is accounting actually about?

Accounting, in general, involves the process of documenting financial transactions that take place in business organisations. This includes making a summary, conducting analysis, as well as creating reports of the transactions to help in making financial decisions. In addition, it’s also crucial for regulatory bodies to ensure the organisation comply with existing laws. 

The responsibilities of an accountant include: 

  • Setting a forecasted budget for the company

  • Regularly managing account closings

  • Ensuring timely bank payments

  • Advising the financial health of a business

  • Reviewing the profit and loss statements

  • Computing taxes and preparing tax returns

  • Auditing the financial transactions and documents

  • Ensuring compliance with financial policies and regulations

 

That said, your role as an accountant may vary depending on the specialisation you undertake.

A hand holding a calculator, depicting someone doing accounting
PS: Do you know what it takes to be a future accountant? Find out during Taylor’s International Accounting Day Fest 2022 here!

 

2. So, what are the different types of accounting?

 

While we mainly think about accountancy as a singular field, it can be split into several types. You can actually choose to specialise in a specific category based on your interest and skills.

a. Financial accounting

This involves preparing the business’s financial statements (income statement, the balance sheet, cash flow statement) by summarising financial transactions that take place in a business

b. Managerial accounting

This involves analysing and creating budgets to meet goals as well as generating monthly or quarterly reports essential for the company’s management team to make decisions on the future of the company based on past performances

c. Cost accounting

This involves taking into consideration all of the costs related to producing a product. Here, you’ll record, present, and review manufacturing costs and oversee all costs to ensure the output is aligned with the cost to develop a product

d. Tax accounting

This involves ensuring the compliance of the company with regard to the tax laws set by either the federal or state. You’ll also help the company to make strategic decision making to help minimise a company's tax burdens

e. Auditing

This involves inspecting and reviewing (internally and externally) a company’s financial accounts to ensure compliance with existing laws

3. What is a common misconception about accounting?

Many seem to hold the notion that being an accountant means you’ll have to forgo a balanced work life. But according to Ms Katharene Expedit, a programme director from the School of Professional Studies at Taylor’s College, accounting life is what you make of it. “Any given profession can be both stressful at times, especially during a peak season and slightly more relaxed at other times. And how busy you are, depends on your seniority in your field.”  

Truth is, just like any other job in the world, there’ll be times when you’ll be less stressed and times when it’s more challenging. Finding the balance boils down to your personal time management. 

Ms Katharene Expedit dispels more myths about accountancy here.

A person who's stressed while looking at their work

4. Why should you pursue accountancy?

 

You may be wondering if the field of accountancy is worth pursuing and what are the jobs available. As nearly all biz operations require an accountant, you’ll have various exciting careers to choose from such as becoming an auditor, entrepreneur, financial analyst, financial consultant, forensic accountant, investment analyst, market analyst, tax consultant, etc. 

Not just that, having an accounting background opens up other avenues in other fields too. There are many other opportunities out there from which an accounting graduate can venture such as finance and business, management, and marketing as the analytical and practical skills you’ll learn in your studies will come in handy wherever you go. 

So with an accounting background, the world is truly your oyster!

5. Are accountants still necessary in the age of digitalisation?

You may also be concerned if robots will be taking over the role of accountants. The short answer is yes. However, as much as Artificial Intelligence (AI) and automation are being implemented, AI can only perform repetitive tasks that have been set in place. As such, accountants are still necessary to perform analysis and provide critical insights that can help management to make strategic decisions. 

The role of an accountant now has evolved from merely operating numbers to being an analytical and critical one. You’ll also have to stay up-to-date with the latest trends to stay relevant and be able to provide valuable insights based on your findings to assist management in deciding the future of the company. In other words, the role of accountants is definitely here to stay! 

Read more about the future of accounting here.

A web of network

We hope you’ve gathered more information about the field of accountancy and becoming an accountant through this article. 

If you’d like a comprehensive explanation on your education pathways, our friendly counsellors would be able to advise you here!

Want more insights on what the role of an accountant entails in the ever-evolving industry? Join us at Taylor’s International Accounting Day Fest 2022 here!

 

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