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Accountant Responsibility

Updated on April 29, 2024
Article byWallstreetmojo Team
Reviewed byDheeraj Vaidya, CFA, FRM

What Is Accountant Responsibility?

Accounting Responsibility means that an accountant should understand and follow their duties of documenting and accounting information to ensure that public trust and the interest of all the related stakeholders are preserved. It also ensures that stakeholders’ interests come first.

What Is Accountant Responsibility

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The company’s accountant is generally given important responsibilities, which include collecting and recording the various financial information of the company, scrutinizing and summarizing the information collected, and then presenting them in the form of a financial statement to the users of the financial information for their decision making.

Accountant Responsibility Explained

A management accountant responsibility is to properly collect, analyse and maintain clear and transparent records of all business transactions so that stakeholders get a true and fair idea about the business.

In today’s globalization and increasing compliance requirements, an accountant’s responsibility and duties change with each amendment. They must keep themselves updated with all the recent changes and new updates and prepare themselves accordingly. With the introduction of IFRS globally, there will be a massive change in the accounting systems  and the way accounting is done in many countries. A global accountant must keep pace with all these changes and ensure that implementation is smooth and the organization is IFRS ready.

Accounting is a fine and noble profession, and it has been in place for quite some time now. . A chief accountant responsibility is regarded as one of the finest, and they are one of the highest-paid professionals. However, with so much respect and money comes the responsibility of moral obligation and ethical requirement to keep things simple and straight and not let down any related party who has trusted accountant work.

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Components

#1 – Accounting

In accounting, if there is any journal posted or invoiced booked in the system, it should be reviewed by the accountant and ensure that the invoice is not booked earlier or from an unknown Supplier. While closing the books for the month, accrual should be made for invoices due but not received, and prepaid should be released.

The management accountant responsibility often involves estimation while providing any expense or revenue item; here, the accountant must be clear in taking the basis for estimation and should be a bit conservative in approach. Also, when unsure of an item, whether to capitalize or expense, one should follow accounting standards and other guiding notes to arrive at a rationale.

#2 – Auditing

The audit is the one thing at which the public, banks, investors, and other related parties trust that the financial statements are presenting a true and fair view. It is saying the auditor is a watchdog and not a bloodhound with so many recent accounting scandals like Tyco, Enron, WorldCom, etc.

The SOX was formed, and auditors were asked to go deep into the books. As an account, while working as an auditor, one should never skip any step of the audit process. They must follow all the steps, take reasonable samples, question any ambiguities, ask the higher management for consent in writing where required, and do all the reasonable checks to ensure that books look good. They should release the audit report only after being satisfied with the validity and accuracy of numbers in financial statements.

#3 – Certified Public Accountant

Accountants working as CPA do so many tasks like return filing, valuation, project reporting, forensic accounting, etc. People use these reports to apply for loans, mortgages, credit cards, cash credit, and other financial needs. While certifying these documents, the chief accountant responsibility includes looking at the original papers, the last few years’ reports, and other affecting factors, and then only they should sign the reports. Similarly, a tax accountant responsibilities are an equally challenging one.

#4 – Digital Environment

Today’s digital world poses a new challenge for accountant tasks, and it is their duty to be equipped with the skills needed to work through a computerized environment. The system development and system audit demand that accountants have the accounting skill set and possess a certain degree of technical knowledge about how accounting is done in the digital world.

The accountant must learn how to use test data in the computer and follow it from the start point where an accountant can see how it impacts the Profit & Loss and Balance Sheet. Today’s digital world is an ever-changing scape, and the emerging cyber crimes and thefts pose a new set of challenges for accountants and need them to be prepared and responsible for challenges thrown at them.

#5 – Moral Responsibility

An accountant is not only responsible for being equipped with the skills of accounting and digitization, but they also have a moral responsibility towards society, regulatory authorities, the country, and all the related stakeholders. Accountants are also called the watchman of economy and treasure, and it is a huge compliment that comes with a high level of obligation and moral responsibility.

An accountant responsibilities in company includes being equipped with the skills of accounting and digitization, but they also have a moral responsibility towards society, regulatory authorities, the country, and all the related stakeholders. Accountants are also called the watchman of economy and treasure, and it is a huge compliment that comes with a high level of obligation and moral responsibility.

Components of Accountant Responsibility

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Example

The auditors and teams of the corporate finance departments in various organizations are facing the dearth in the number of accountants who have the responsibility to deliver accurate financial records to stakeholders. This shortage is due to second thought by these accountants regarding their career or due to demand for higher pay package and better work schedules. This situation is resulting in errors in the accounting work since fewer people are handling huge workload. However, big entities feel that this challenge will help them attract better talent to the workforce.

Advantages

  • Financial statements represent the true and fair view of the entity’s financial status
  • Audit facilitation becomes easy
  • A tax accountant responsibilities include tax filing and other statutory compliance.
  • Improves public faith and investors trust which is good for business
  • Improves Goodwill in the long run
  • An accountant responsibilities in company  includes Improving relationship with banks and making it easy for financing activities

Disadvantages

  • If the bookkeeping and records are not kept systematically, the audit process becomes difficult, and auditors may qualify the audit report.
  • One bad misconduct or scam can badly take a legendary organization down towards bankruptcy.
  • If the accountant is not following processes in place, it also points out loopholes in internal controls
  • Loss of Goodwill and business

Recommended Articles

This has been a guide to what is Accountant Responsibility. We discuss its components, along with example, advantages and disadvantages. You can learn more about accounting from the following articles –

Reader Interactions

Comments

  1. kwizera remy says

    I want to be an accountant

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