Page 461 - Introduction to Business

CHAPTER 12 Financial Reporting 435

Careers in Accounting

A good place to obtain information about careers in accounting is from the profes-
sional accounting organizations, such as the American Institute of CPAs, the Insti-
tute of Internal Auditors, the Institute of Management Accountants, and the Asso-
ciation of Certified Fraud Examiners. In fact, several accounting organizations offer
student memberships at discounted membership dues.
The American Institute of CPAs offers a Student Affiliate Membership for $35
per year, starting as early as your freshman year in college and going through to the
end of graduate school. Membership is also available to recent college graduates
who are in the workforce and who have not yet passed the CPA exam. Student Affil-
iate Membership in the AICPA includes a subscription to the Journal of Accoun-
tancy, a subscription to The CPA Letter, a newsletter, access to the AICPA website
(www.aicpa.org), access to a student web page (www.aicpa.org/nolimits), dis-
counts on publications, software, professional development courses, and confer-
ences, self-assessment and career tools, and more.
The Institute of Internal Auditors offers a student membership for $30 per year
(regular dues are $115 per year). Student membership is available to full-time stu-
dents who are studying internal auditing or related courses at colleges and univer-
sities. IIA student membership benefits include career networking opportunities
with other members, a subscription to Internal Auditor magazine, a subscription to
Auditwire (the association’s newsletter), access to the twice-monthly e-magazine
ITAudit Forum, access to the Audit Career Center (including the IIA Resume Ser-
vice), and more.
Becoming a student member of a major professional organization can help you
start building a career as you gain opportunities to learn more about the account-
ing profession and to meet with accounting professionals.

Summary

LEARNING OBJECTIVE 1 make effective business decisions. The most important
Explain the role of financial reporting. output of the accounting information system is the set of
financial statements. These accounting reports include
Accounting provides critical information to business
the income statement, statement of retained earnings,
managers within the firm and to interested parties
balance sheet, and statement of cash flows. The income
outside the firm. Within the firm, managers use
statement shows the firm’s revenues, expenses, and net
accounting information to make decisions regarding
income or loss for a period. The statement of retained
the operations of the firm. Accounting will determine
earnings shows the change in retained earnings from the
whether the revenues of the firm exceed its expenses,
beginning to the end of the year. The balance sheet
thus resulting in a profit. Alternatively, accounting will
provides a snapshot of the firm’s financial position. The
determine whether expenses exceed revenues, thus
statement of cash flows presents receipts and payments
resulting in a loss. Naturally the managers want the firm
for operating, investing, and financing activities.
to make a profit.
LEARNING OBJECTIVE 2 LEARNING OBJECTIVE 3
Define the components of the four financial Describe the contribution of auditing to the
statements. usefulness of financial reporting.
Accounting is called the language of business because A key concern of investors who rely on the integrity of
accounting provides the information that people need to the financial statements is the validity of the reports

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