Accounts are ‘Statements of facts relating to money or things having
money value”. The ‘facts’ that are incorporated in accounting records are
described as transactions.
Accounting
A mere chronological listing of monetary pecuniary transactions in the
form of Cash Accounts does not bring out the significance of the
transactions and their aggregate effects. Form such a cash accounts a
man cannot tell, without going through every item, how he stands in
relation to his various customers and whether his business is profitable or
not. It becomes necessary that his transactions should also be classified
under various heads, as for example the names of various customers
dealt with or of various articles dealt in; and that the results of the
transactions under these heads should be arranged in such a form as to
show clearly not merely the significance of each separate transaction but
also the combined effect of any desired series of transactions. The
process through which these ends are effected is called accounting.
Compilation of Accounts
The initial accounts of Government transactions in India are prepared by
the authorities through whom the transactions occur, such as treasuries,
the various departmental offices, pay and accounts organizations, etc.
From these initial accounts the Indian Audit & Accounts Department as well as the Central Accounting organizations of the Union Government
compile, under different heads prescribed for Government accounts, and
bring out, monthly and annually, the combined result of all the transactions
which occur during that period. From the accounts so compiled by the
Indian Audit and Accounts Department and other agencies, the Union and
the States Governments are prepared by the Comptroller and Audit
General. These accounts incorporate the results of the total Government
transactions arising both in and outside India.
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