Week 10 Reading Reflection

This is my chapter, and the one I’ve enjoyed the most. Right of the bat I just hate how little importance everyone (maybe not everyone) gives to accounting. The author only dedicated one chapter to this subject. In the real world if you don’t have intensive accounting knowledge you’re going to run into a lot of problems that otherwise you could have avoided. I hate how the author does not give any attention to controls. Accounting, although some might find hard to believe, is not just about creating taxes and sending them to the IRS. It’s not even about creating reliable financial statement. It’s about the accounting controls. When auditors go into a corporation to audit their finances, you really think they have enough time to go through all those numbers and check if someone is recording them wrong or stealing? That would take about twice the amount of time it takes to just make them. Accountants audit the companies controls, if a company have good controls that means their facial statement are most likely presented fairly. Not vice versa. I personally believe the U.S has the best standards with GAAP. IFRs is slightly simpler but there’s a lot of grey area that I don’t agree with. If a country wants to control corruption, money laundering and wants to expand their internationals trading markets, financials statement and standards are crucial and I would highly suggest adapting GAAP. If you can just imagine how important these documents are to investors, make that triple the importance in your head. Financials are crucial in getting investors trust and money, as an entrepreneur, if you can realize the importance and use it to your advantage you would be not just one, but a good 8-14 steps ahead of the game. How many business go under just in one year that could have been prevented if the business had a management team that understood accounting controls, budgets and financial assessments? All of them. This chapter does not do accounting justice and it intertwines a lot of accounting and finance concepts all in one. Yes it’s important to know the accounting and finance are sisters who work very well together, but it’s also important to know that accounting is the bigger, stronger sister. Well by now you can probably tell I’m an accounting major, if not I’ll leave you with one last note, accounting is not math, it’s and art.