Accounting is how your business records, organizes, and understands its financial information. Accounting is a big machine that you put raw financial information into records of all your business transactions, taxes, projections, etc. that then tells you a story about the financial state of your business.
Accounting provides a clear picture of your financial position. It helps a business in identifying whether or not it is making a profit, what its cash flow is, and what the current value of
Company's assets and liabilities is, and which parts of business are actually making money.

Different types of Accounting :

• Financial accounting
  Financial accounting is concerned specifically with the generation of reports that are based on accurate information and follow "Generally Accepted Accounting Principles" (otherwise known as GAAP). GAAP sets accounting standards in the United States for a wide array of topics, including financial statement presentation. Financial accounting is the process of recording, summarizing and reporting a company's business transactions through financial statements. These statements are: the income statement, the balance sheet, the cash flow statement and the statement of retained earnings.
• Managerial accounting
  Managerial accounting (or management accounting) is similar to financial accounting, with two important exceptions:
  1. The statements produced by managerial accounting are for internal use only.
  2. They're generated much more frequently-often on a quarterly or monthly basis.
  This is somewhat that a financial analyst might do, although a financial analyst will also look at past and current trends in the larger economy, not just your business, to inform their recommendations.
• Tax accounting
  Tax accounting is designed to make sure that you don't pay more income tax than are legally required to by the IRS. Tax accountants are experts at preparing tax returns and assisting people and businesses with filling out forms and paying taxes. These accountants must stay up to speed on all of the rules and regulations because tax law is endlessly complicated and continuously changing. A competent accountant will be familiar with every tax deduction and credit that a person is entitled to. These accountants assist clients in lowering their tax costs.
• Cost accounting
  Cost accounting involves analyzing all of the costs associated with producing an output (whether it be a physical product or service) in order to make better decisions about pricing, spending, and inventory. Cost accountants help businesses by overseeing and analyzing cost expenditures and purchases within the organization.

Book Keeping

Maintaining accurate and thorough records is the goal of book keeping. This is accounting's bread and butter. Accountants have no data to work with unless book keeping collects it. Small business record keeping can provide an up-to-date snapshot of a company's financial condition and health. It entails keeping track of all inputs and outputs, as well as double checking everything to ensure that everything has been properly recorded. The general ledger is the most important document for a bookkeeper to work with because it contains all of the accounting data for a company. When it's time to pay taxes or ask for a loan, a bookkeeper can simply put together the financial records for a certain period of time to create a financial statement.

Why do you need book keeping?

• Bank Reconciliation
  One of the reasons professional book keeping services are so important is because of human error. Any process run by people is going to make mistakes. That's inevitable, and a good book keeping system will catch those mistakes. That's where bank reconciliation comes in. Bank reconciliation is a process of assessing and comparing your financial records to those of your bank and fixing mistakes if the records don't match the way they're supposed to.
  You process payments and then deposit those payments in the bank. If your records are accurate, your payments record should perfectly match the bank's record of deposits.
• Accounts Payable
  Accounts payable are an essential part of your general ledger and a key indicator for
  Assessing your company's financial situation at any given moment. You should keep track of all of your payments and expenditures under accounts payable. As soon as you plan or schedule an expense, it should be recorded in this account. As soon as you order more stock for inventory, that cost goes here, even if you haven't yet paid that bill. Keeping track of cash payments you make will give you a sense of how much money you have on hand.
  However, accounts payable is a category that includes future expenditures as well, which helps you plan. If you have an interest payment on a business loan due in the next month, you can plan appropriately to have the money when you need it.
• Accounts Receivable
  Accounts receivable are all expected or scheduled proceeds or sources of revenue. If a customer buys a product on credit or with an extended payment plan, you need to know when you expect to receive that income. You might not be able to receive that cash right away, but you can plan future expenses based on the expected in-flows from those accounts receivable. The category of accounts receivable on a general ledger is important because it lets you look ahead and plan. The more informed you are about your company's financial situation, the better prepared you are to adjust and adapt as needed.
• Payroll Processing
  Payroll processing is another important accounting service. Managing a regular payroll and records can take up a lot of time and effort, even for a small business without too many employees. Accountants work with businesses to organize and automate payroll systems to work better for both employers and employees.
  Accounting services regarding payroll can involve gathering employee information, establishing a time tracking system, and managing the actual processing of payments to staff. Even if the system is mostly automated, accounting work in this arena still involves approving and submitting payroll, reporting and updating records, and working with employees to address any issues.