Importance of accounting Essay Example | Topics and Well Written Essays - 1000 words

Importance of chronicle - Essay ExampleIt is proved that accounting systems can highly influence the conclusiveness-making process and that the mode of intervention of these systems in the above process is non standardized. Under these terms, it can be assumed that the view of Thaler on accounting systems, as presented above, is justified.In localise to understand the role of accounting system in the decision-making process it would be necessary to refer to the enfolding of accounting information in critical decisions. Indeed, accounting systems affect the decision-making process finished the data they incorporate, i.e. through the accounting information. Drury (2007) notes that accounting is used for communicating information to people who have an interest in the organization, i.e. shareholders, employees or even the government (Drury 2007, p.4). It is assumed that the primary role of accounting is to provide to individuals critical information in regard to various business ac tivities. Nikolai et al. (2009) note that accounting information has a different role in decision-making. For example, investors use accounting information, as incorporated in a companys monetary reports, in pronounce to decide the level of their investment in the particular organization (Nikolai et al. 2009, p.7). Moreover, stock exchanges too brush up the accounting information in order to take decisions related to listings, cancellations or rule-making (Nikolai et al. 2009, p.7). Accounting information is also valuable in negotiations between employers and trade unions. The latter need accounting information in order to get informed on the financial status of the employer involved and decide on their position and their financial claims (Nikolai et al. 2009, p.7).According to Hall (2010) accounting information is quite critical in the development of strategical decisions. It is explained that strategic managers have to review their firms financial data before taking any decis ion (Hall