tailieunhanh - COST ACCOUNTING

The national Code of Ethics for Professional Accountants of Romania establishes rules of conduct for professional accountants and formulates basic principles to be followed by professional accountants to achieve common goals. Romania accountants and entities operating in different sectors of national economy as freelancers or as employees; basic purpose of the Code, but must always be respected. National Code of Ethics for Professional Accountants of Romania is divided into three parts. Part A establishes the fundamental principles of professional ethics for professional accountants and provides a conceptual framework for applying these principles. Conceptual framework provides guidance on fundamental ethical principles | PART I COST ACCOUNTING Section A INTRODUCTION 1 NATURE AND SCOPE OF COST ACCOUNTING INTRODUCTION In the modern business world the nature and functioning of business organisations have become very complicated. They have to serve the needs of variety of parties who are interested in the functioning of the business. These parties constitute the owners creditors employees government agencies tax authorities prospective investors and last but not the least the management of the business. The business has to serve the needs of these different category of people by way of supplying various information from time to time. In order to satisfy the needs of all these group of people a sound organisation of accounting system is very essential. In the ancient days the information required by those who were interested with a business organisation was met by practising a system of accounting known as financial accounting system. Financial accounting is mainly concerned with preparation of two important statements viz. income statement or profit loss account and positional statement or Balance Sheet . This information served the needs of all those who are not directly associated with management of business. Thus financial accounts are concerned with external reporting as it provides information to external authorities. But management of every business organisation is interested to know much more than the usual information supplied to outsiders. In order to carry out its functions of planning decision-making and control it requires additional cost data. The financial accounts to some extent fails to provide required cost data to management and hence a new system of accounting which could provide internal report to management was conceived of. NEED FOR COST ACCOUNTING The need for cost accounting arises owing to the following To Overcome the Limitations of Financial Accounts Financial accounting records in an overall manner the results of the operations of a business using .