Business Accounting refers to the set of procedures and tools used to record, classify, and interpret all economic and financial operations of a company. It allows us to monitor the asset situation, economic results, and cash flow, providing essential information for managing and controlling business activities. Business accounting is mainly divided into two complementary tools: general accounting and cost accounting.

General Accounting (Financial Accounting)

It deals with representing the company's asset and financial position through the financial statements, complying with national and international accounting standards (IAS/IFRS).

Recordings are made in the journal, inventories, and other mandatory registers, following the double-entry principle. It provides essential information to shareholders, creditors, and authorities to assess the financial health of the company. Companies can adopt different accounting regimes:

• ordinary accounting, monitors all economic and financial movements; mandatory for companies with high turnover;
  
• simplified accounting, limited monitoring of purchases and sales; intended for smaller businesses;
  
• Flat-rate regime, a favorable regime for sole proprietorships and self-employed individuals with revenues up to € 85,000.
  
  

Companies under the ordinary regime must keep mandatory records such as:

• journal;
  
• inventory book;
  
• ledger;
  
• VAT registers (purchases, issued invoices, receipts);
  
• account masters and auxiliary records;
  
• inventory and stock records;
  
• register of depreciable assets.
  
  

Cost Accounting (or Analytical Accounting)

It is a fundamental tool within companies for analyzing in detail the costs and revenues associated with specific elements such as cost centers, products, services, or projects. Its flexible and customizable nature allows adaptation to internal needs, without being bound by strict regulations like general accounting. Main purposes and uses:

• support for internal strategic decisions;
  
• accurate allocation of costs to various production or service processes
  
• analysis of deviations between budgeted and actual costs/revenues;
  
• optimization of business processes;
  
• determination of the most competitive selling prices;
  
• Improving profitability and market competitiveness.
  
  

The main operations of cost accounting are:

• preliminary determination: planning and defining expected costs and revenues;
  
• actual recording: collection and registration of actual costs and revenues during operations;
  
• allocation, grouping, and analysis: assigning costs to responsibility centers, analyzing variances from budgets;
  
• demonstration and control: verifying the consistency between planned and actual costs/revenues, identifying inefficiencies;
  
• calculation of specific economic results: analyzing specific profitability or performance indicators.
  
  

Conclusion:

In summary, while general accounting provides an overall and compliant view of the asset and financial situation, cost accounting allows for an in-depth analysis of costs and revenues, supporting more informed internal decisions. Both tools are essential for effective and strategic business management.

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