Accounting Theory and Practice

Accounting like any other profession has it’s own technical symbols, terminology, and principles.  In accounting, these elements form the “vocabulary” which is used to convey financial information, especially that information presented in the form of financial statements.  Accounting is often referred to as “the language of business.” Executives, investors, bankers, creditors, and governmental officials use this language in their day to day activities.  In order to effectively communicate in today’s business world, a fundamental grasp of the theory and practice of accounting is required.

Many of those presently employed in the hospitality industry, and many students who are new to the field of hospitality sometimes feel that the language of business is understood only by specialists who seem to thrive on “number crunching.”  This misconception arises from an unfamiliarity with the fundamental purpose of accounting and the logic which lies behind basic accounting activities.

This week we will be focusing on the basics of Hospitality accounting.  We will look at questions such as:

Why should supervisors and mangers understand accounting?  What is the fundamental purpose of accounting?  How much math is needed to understand accounting?  What is the difference between bookkeeping and accounting? What career opportunities are there in the field of accounting?  What fundamental principles apply to every aspect of business enterprise?

It is important to understand the theory and practice of accounting for managers, supervisors, and any students planning to study the field of Hospitality accounting.  Any professional career will require economic decisions and all economic decisions require financial accounting.