"Financial accounting" refers to the process of systematically recording, organizing, analyzing, and reporting on the financial transactions of a business. This includes the recording of revenues, expenses, assets, and liabilities in accordance with applicable accounting principles and standards. The purpose of financial accounting is to document the financial position of a company, create transparency, and provide a solid foundation for management decisions as well as compliance with legal requirements.
Typical features of software in the "financial accounting" area may include:
Bookkeeping: Recording and processing of entries for revenues, expenses, assets, and liabilities according to the double-entry accounting system (debit-credit principle).
Account management: Maintaining accounts for various financial categories such as bank accounts, creditors, debtors, assets, etc., to accurately track the financial position of the company.
Automated postings: Automated capture and posting of recurring transactions, periodic entries, and closing entries to streamline the accounting process.
Financial reporting: Generation of financial reports such as balance sheets, income statements, cash flow statements, and other relevant reports to analyze and communicate the financial performance of the company.
Tax calculation and reporting: Calculating taxes based on financial data and preparing tax returns and reports in accordance with tax regulations.