THE ROLE OF ACCOUNTING IN DECISION MAKING.
Business is getting an increasing insight into its cost mistakes. It is analyzing their causes and taking preventive action. One means of taking preventive action is through financial analysis. Financial analysis is a service performed by the accountant for management. Every day a business enterprise is faced with alternatives. Choosing between these alternatives is the decision-making process that means the life of the business. Financial analysis cannot be done by the amateur. Every business man is a selfstyled analyst and, in large corporations, this function is assumed by nearly every department head and division manager, by heads of sales, scientific research and production. It is the job of the accountant, as financial analyst, to uncloak even the most obsecure aspects of proposals calling for capital expenditure, to remove any camouflage that may exist and to reexpress them in common language and format, using similar definitions and measurements and adopting as a common denominator a comparable formula for investment, return and profit.
- DOI
- 10.2308/tar-7061079
- Volume
- 35 (1)
- Pages
- 37-44
- Language
- en
- Export
- BibTeX
- Sources
- openalex crossref