Financial accountancy

Financial accountancy (or financial accounting) is the branch of accountancy concerned with the preparation of financial statements for external decision makers, such as stockholders, suppliers, banks and government agencies. The fundamental need for financial accounting is to reduce principal-agent problem by measuring and monitoring agent's performance.

Related Topics:
Accountancy - Stockholder - Supplier - Bank - Government agencies - Principal-agent problem

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The accounting equation (Assets = Liabilities + Owners' Equity) and financial statements are the main topics of financial accounting.

Related Topics:
Asset - Liabilities - Owners' Equity

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A financial accountant must equal assets with liabilities and owner?s equity. The balance sheet (or the statement of financial position) is the financial statement that summarizes the assets, liabilities, and owners? equity of the company.

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