Sample Essay

The accounting process is a key function of a business which keeps track of all business finance and provides an accurate reflection of a company’s earnings, financial standing and cash flows. Both internal and external stakeholders of a company base critical financial decisions on accounting information.  The underlying theory for any field of study is quite significant as it provides the necessary concepts, framework, principles, procedures, rules and regulations governing that field of study or subject. This paper explains the importance of accounting theories, several types of accounting theories and differences in these theories.

The practical application of any subject is an art as not everyone who has studied a specific subject can implement the knowledge quite effectively. Accounting theory is a science and its practical application is an art which cannot be applied efficiently without proper comprehension of these theories. Theories though quite important do not have any physical or practical form but are composed of principles, techniques and procedures based on words and statements.

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