Accounts and Finance

Now to begin with, many people have a mindset that finance and accounts are the same. According to many people these two fields belong to a same domain of knowledge. However, the fact persists that these two subjects are alotgether different and have got each area to be explored and learn in its own fashion.

To put the description in simple words, the whole functioning of an organization cannot start without finance. For an enterprise, finance is one the blood line which brings in monetary aspects which mobilize the operations and hence make the business move. However, we can have exceptions to this rule too. There are organizations who have made it successful and have started without and finance or capital.

When the organization takes a momentum, there are daily aspects of monetary mobilisation. Which simply means that there is money required for everything, right from purchase, procurement, transport, delivery, manufacturing, storage, power, safety, deployment and sale. Hence for each of this factor to be incorporated in the functioning of an organization, there are money transactions happening. It is very essential for an organization to have a written record of all the money transactions happening in the whole functioning of the business. This is the step where 'accounts' come into picture. This is the point where the role of 'Accounts' start.

Accounts are primarily the process of recording the daily transactions happening in the business. These transaction are both ways; it is income as well as expenditure record.

Now after putting in the records of all monetary transactions the company also needs a overall picture of all the transactions that have occured in the whole year. Hence at the end of the year, the organization reviews all the transactions and prepares some accounts which give a bird's eye view of all the monetary transactions happend in the whole year. And also they come to know the present situation of the assets and liabilities of the organization. These are called the 'final accounts' of the organization.

The 'finance' domain starts with going skin deep of all these transactions happening in the market. The finance asks question, "Why is this transaction done?", "What is the relation of the spend to the financial position of the company?". These are the areas where the finance domain really starts in the organization's transactions. The finance stream covers aspects like risk allocation, investment, sources of funds, shares, equity, debt, ratios, investment portfolios, market portfolios and many more. We will be looking at each topic in detail ahead, so that the concepts of each topic are covered more detailed.