It is an accounting term.|||Financial accounting is the accounting process of classifying and recording all events that took place during the normal course of the doing what ever it is the company is in the business of doing.
The results of these events are then arranged on the correct financial statement and reported to the external users of the financial statements. External users include investors, creditors, banks and regulatory agencies such as the IRS and the SEC.
External users of the financial statements differ from internal users in that the external user is generally considered to be the uneducated user of the financial statement. That is to say, the external user has no clue as to what is going on within the company.
Financial Accounting is used in all three types of businesses: service, merchandising and manufacturing. It is a needed accounting skill in all types of business entities (sole proprietorships, flow through entities and corporations). Financial accountants will primarily be employed by for profit businesses.
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