Types of Accounting in India: Evolution of India’s Accounting Service Branches
Rapid economic boom triggered by the influx of investments both local and international saw accounting services evolves into many forms. The evolution primarily aimed at providing speciality accounting services depending on the circumstances.
Further fueled by the onset of digital technology, the emergence of specialized fields gave businesses a wider range of accounting types from where they could pick one satisfying their requirement.
Web sources enumerated 29 types of accounting but only seven of which dominate India.
Growing Need for Various Types of Accounting
India’s economic boom could well be attributed to how investors see the country. Investors’ keen eyes see in India some 1.35 billion potential clients. The figure, deemed as one of the world’s biggest markets, thus becomes a favorite spot for foreign companies to do business.
Investments in India come in various forms. Each and every form requires specialized various types of accounting.
Incidentally, only seven of the 29 types of accounting services dominate the demand chain of the accounting service sector.
Types of Accounting in India
The types of accounting services required by organizational entities include the following:
This particular type of accounting service embarks on collation, summary and presentation of the numerical financial figures derived from the company’s business transactions. A financial account particularly reports profits. More than profits, the financial accountant gets to determine the company’s worth for presentation and report to the company shareholders. The financial accountants should be able to provide detailed reports on revenue, expenses, assets and liabilities and its equity. A financial accountant presents such reports in accordance with the existing guidelines set by India’s Ministry of Corporate Affairs.
Of India’s major types of accounting services, management accounting deals with the business operational report. This is the kind of report the corporate board of directors refers to while rendering decisions for the company. Among the operational reports required from management accounts involve meticulous analysis of the company’s standings. The nature of the report being “for internal consumption,” makes it distinct. A management accountant complements efforts with company risk managers, budget officers and planning specialists.
As the name suggests, this type of accounting embarks on the government. Under this accounting system, a designated accountant deals with lots of work – recording of transactions, analysis on spending, transfer and even how the money was spent. Moreover, a government accountant meticulously interprets and simplifies financial information. Disposition of assets also falls under government accounting. In short, government accounting sees to it that every dime is spent in accordance to what it was intended for. Government accountants may also be considered as the “check and balance” under this particular type of accounting service.
Taking cue from its name, this type of accounting service branch predominantly deals with taxes. Tax accounting in India embarks on the fundamentals of taxation, accounting and auditing. Part of this particular type of accounting service involves legal and regulatory obligations for the investors to comply with. This is where you’d get to learn about Goods and Services Tax (GST) and how it differs from India’s indirect taxation system. A tax accountant or tax specialist, guides companies in complying tax laws in India. Without a tax accountant, many businesses operating in India may find it difficult to cope up with the complexities of India’s taxation system.
Some sectors in India refer to it as forensic audit because of its distinct nature, to find what, where, how and who went wrong. This accounting type digs deeper to detect fraudulent transactions. A forensic accountant’s job, however, doesn’t end on spotting one. Using a different kind of accounting method, a forensic accountant should also be able to collate evidence seen crucial in running after white-collar criminals and recovery of what has been fraudulently taken from a company. In other countries, they are referred to as graft busters.
This type of accounting services works under limited condition. Among the limitations include budget, timetable and purpose for the project accounting. It is helps keep abreast with particular projects. A project accountant is expected to prepare a financial perspective of any given project. The work entails financial reports on a project’s cost estimate, timetable (ingress and egress) orders, replacements, purchases and of course, the billing. An effective project accountant provides a comparative report seen to give the company a viable option as to where and how they could save at any given project.
This type of accounting service in India targets public perception. Social accounting makes an impression seen to give a business entity an impact on its operations. It’s more of a PR stunt, except that it embarks on numbers of people and sectors approving what companies refer to as their share of corporate social responsibility.
Name It, We’ll Do It
With an influx of investments in India, businessmen would definitely find the types of accounting services apt for your need.
Whatever type of business you’re into, regardless of the type of accounting service you need – we’re on top of it. We embark on a working principle of excellence, efficiency and economy, or simply 3E.