The Accounting Cycle And The Auditing Cycle

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The accounting cycle, the accounting cycle is a routine of steps that companies use to provide data in order to evaluate how their business is performing during the year, and prepares the company for the New Year to come on financial statements. There are ten steps to the accounting cycle and these steps are repeated during each reporting period. (Tracie, Brenda, & Ella, 2013). Each step which will be demonstrated in detail along with their roles, and how a company is impacted if the omission of a step was not preformed. Then moving into how the four major financial statements plays a significant role in the success of a business. Therefore, the accounting cycle steps should be followed by all companies, because they will provide an easy way to collect and organize data in a way that will aids businesses and their leaders to make decisions about their financial situation as they move forward. The accounting cycle starts off with collecting all the documents that are linked to the business financial transactions. These documents are items such as bank statements, cash on hand, and any expenses that have occurred. Collecting data for a fiscal period plays a substantial role for all business to begin to understand how all transactions will have an impact on the health of their company. The second step is where the financial transactions start to come together, after reviewing all the data for the period, the business is ready to begin entering the information into the journals

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