Accounting is stated to be the language of business. It is a systematic process of recording, analysing, and summarizing an economic establishment’s daily financial transactions.
It keeps the track of every petty cash issues like income or expenditure, so that it can effectively communicate reports to the ones who rely on financial information that includes internal users like the manager, and his subordinates and labour unions and external users like insurance companies, banks, prospective investors, governmental and private agencies as well as the financial analysts.
Efficient and effective communication of information leads to a smooth and successful business.
It is advisable for the accountants to present the financial reports in a concise and clear manner, so that it can help analysts to keep track of every transaction. The accounting report is also called financial statements.
Accounting is sometimes applicable in the fields of social media. It has become an important branding, marketing and sales tool for accountants. In order to understand how social media benefits accounting in a company, one first needs to understand what accountancy is about, what its components and the rules that an accountant follows to record the transactions.
Various components of Accounting
To understand what accounting is all about, one has to understand the details of various components of accounting. These are as follows:
- Recording:
Recording is the primary and the main function of accounting. It means to record all the transactions, incomes, and expenditures that the firm faces on daily basis. Recognising every transactions and recording it systematically is called Book keeping. In order to record, accountants maintain a set of books. In the light of recent times, computers have been positioned to account for transactions as they take place to keep the records more safe and secure and to make the work less time consuming.
- Summarizing:
Recording transactions is called raw data. These raw data are of no use or minimal use to the managers as it is not enough to make a concrete decision about company’s workings. Accountants classify the raw data into different sub heads. As and when transactions take place, firstly an accountant records it and then summarizes the record.
- Reporting:
An owner needs to be recurrently updated about the company’s operations that are being financed on a daily basis. This is why; there is periodic report, which is sent to them quarterly or annually. In general, frequencies of these reports are sent quarterly and there is a single annual report that summarizes the activities and transactions of four quarters. Reporting is done in the due course of every transaction that takes place and in the form of financial statements. Thereafter government agencies synchronize these financial statements to ensure that there is no deceptive reporting of the transactions.
- Analysing:
Lastly, accounting conducts an analysis of the total result. After the process of summarizing and reporting of the results have been done a meaningful conclusion needs to be drawn. Managers of the company must look out for its positive and negative aspects. Accounting does the same by the means of comparison. It is needed to compare profits, losses, cash expenditures and incomes, sales, assets, etc with each other to analyse the overall activities of the business.
Golden Rules of accounting
Golden Rules of Accounting is an essential part of financial accounting. It is the set of rules that an accountant should always keep in mind while accounting for all the transactions. These rules allow anyone to be a successful bookkeeper. They need to recognise the types of accounts and then carefully apply the rules.
- Debit the receiver, Credit the giver
This principle states that when a person provides something to the organization, it is considered as an inflow of cash and consequently the person must be credited in the accounting books. The converse of this is also true, that is when the organization gives something to some external users of the company, and it becomes outflow, which is why the receiver needs to be debited.
- Debit that comes in, Credit that goes out
This is the second most important principle that is usually appealed in the case of real accounts. Real accounts include land, machinery, buildings, and other assets etc. It is said that they have a balance of debit by default. Therefore, when one debit what comes in, one is actually adding to the already existing account balance. In the same manner, when one credit what goes out, one is eliminating the account balance when an asset is given out of the organization.
- Debit expenses and losses, Credit Gains and incomes
This particular rule is applicable when the account is in nominal account. The capital of an organization is always taken as liability. For which, it always has a credit balance by lapse. When one credit gains and incomes of the company, one increases the capital and by debiting losses and expenditures, it decreases the capital. This is what is required to be done for the system to withstand in balance.
How Social Media can be of great use for Accounting
Building up of a private accounting was once a procedure of registering in a Certified Public Accountant (CPA) course. Getting one’s name enrolled in one of the CPA courses and passing with flying colours in the end of the two years of accurate post-qualification experience, one must consider infusing efforts and time into evolving social media occupancy in order to attract clients and flourish in the industry.
Social Media helps those who are in the process of building up private limited firms discover their target audience. Branding and marketing proficiency can be done via social media can help one to put up a reputation as master of the subject matter and connect one to prospective clients and also attempt to link with media vents and mates.
Be it to specialize in personal finance, standards of accounting or the wider version of it, social media strives to help one engage with localities and forums, who are interested in one’s subject matter. Accountants who have their own blogs to post, to share in depth knowledge, and to master on themes can process them by the means of Facebook. It helps to record videos and tutorials on YouTube. If the contents that the accountants posts are regular, strong, viable, informative and have high chances of engaging people’s attention will help the fellow accountant and his firm to rise ahead of the rest.
A survey on social media was conducted which has stated that in recent times, accountants are progressively seizing social media as vital part of their marketing strategy. In fact, the survey has shown that a gigantic 75% of accountants are seen using social media since the year 2014.This social media accounting has kick-started with that platform, LinkedIn and a total of 40% of them use Twitter and a surprisingly even Facebook is found to be the most functional platform. Women are seen to be the most active and reliable users, with 80% of them have reported using social media frequently in their work lives compared to that of men.
Presence of social media is beneficial for accounting firms
Accounting firms tend to use more of social media platforms as it is considered a powerful business tool. Social media might not be the largest channel process branding and marketing, but it has a huge potential to build brand awareness, manage Website traffic, and help to build up relationships with clients. Mentioned underneath are some of the benefits that a firm can get from:
- Increment of brand awareness
- Develop community by the means of social engagement
- Help to keep control on the expenditure and reduces the overall marketing costs
- Attracts the attention of well off target customer
- Helps to establish thought leaders inside the industry by building up and maintaining trust with colleagues.
- Helps to establish and strengthen nook fields.
- Maintain high clarity in the market.
Tips to make social media successful for accountants
Social media takes time and energy like any other marketing tool in order to establish a firms marketing strategy. A concrete social media plan can help one to obtain growth and development quick. Accountants tend to incline on the benefits of an effective strategy that can be of various cost-effective ways to market the company’s services. Some of the ways that can channel out to reach prospective clients and marketers are as follows:
- To be persistent:
One must be well prepared to have a social media presence. Accountants have to strive for the completion of the task through social media, there is no point of starting something, and that cannot be completed in the end. Opting for social media strategies will lead to a regular flow of information to the target audience about the company.
- Choosing of content and its tone:
One should think carefully about what image to provide in the social platform. In context to the content for a corporate social media account, one’s brief needs to be broad. At this stage, one tends to find interest in the idea of developing a concrete social media presence as per to the content. One has to build trust on his/her team to provide contents that are appropriate and relevant to post on the media.
- Engaging:
As we all know thatsocial media is a great way of connecting with people, it helps to gather attention of the targeted customers by showing them the fair side of the business for instance its advantages, workings, and how it contributes to the surroundings and environment. With that information in mind, it is beneficial to create contents that can be engaging and interesting enough to keep attention of the audiences for long and relevant enough to keep their urge of coming back to know more.
- Collective Thinking:
New way is required to be thought about on how one can to let people or the customers know that an accountant of the company has a social media presence and where they can find about the company’s strategies. Linking up with different platforms like websites, Facebook, Instagram, Pinterest, twitter, and LinkedIn pages is comparatively a forthright way that can help direct traffic. A recent advancement of technology has added a live feed system to the social media platform to ensure that customers can see what the company is posting to stay updated about the upcoming programs, and what its thoughts are, across the platforms.
- Looking for a better future:
The constant transformation of technology has changed the way to communicate and increased the urge of looking for new big strategies.
Elements to build up a concrete social media strategy
Elements that are required to build up a strong social media strategy are as follows:
- Identification of Business Goals:
Every element of company’s social media strategy serves as the goals one set. One needs to closely and carefully look at company’s general needs and then decide on how an accountant wants to use social media to contribute in order to reach out to the target audience quickly. Some of the business goals that a company should include in their strategy are- brand awareness, with holding customers and reducing marketing expenditures.
- Setting Objectives of marketing:
A marketing objective defines how one can get an unaccomplished goal to a successfully achieved goal. One needs to make their objectives clear, specific, measurable, achievable, less time consuming, and relevant.
- Identifying target audiences:
A business suffers from low engagement on social media profiles, for not having an ideal customer profile. One needs to know about the company’s target audience’s age, income, interests, occupation, problems, habits, Preferences, motivations, and objections, to make it easier and less expensive to target them on social media.
- Allocation of budget and resources:
A lot of business tends to establish the budget first, and then consecutively select which tactics fit in well to that budget. Well some businesses do the opposite that is, they establish a strategy first, and then decide on the budget to be invested.
Accounting firms should take in consideration; their prospective competitors are already being benefitted by progressively using social media marketing strategies, so it is advisable to start right away. It should be an important part a business’s development strategy and if done efficiently, it can magnify the effectiveness of the business development efforts.
Author’s Bio:
The accounting author here is Eugene F. Soltes who is a well-known manager of a renowned American Company. He is an MBA graduate from University of Chicago. He is an accounting educational expert as well. He is working as an online analyst on accounting for past few years, and has assisted many students regarding accountancy. He has an experience of working on over 500 different kinds of projects. He now urges to look to have new challenges upcoming her way while working on the assignments to learn more.