Role of accounting in creating a sense of values and accountability.
Every taka is written in the account book, and someone walks in and says, “show me the accounts.” The person whose books are in order shows them without worry. The one whose books are not feels afraid. Keeping accounts is not only arithmetic; it shapes character too. This note shows how.
1. What a value is
A value is a standard formed over a long time out of the beliefs, thoughts, concepts and perceptions of people and society. With this standard people judge right from wrong, accept the right and leave the wrong.
2. Five ways accounting builds values
The book gives accounting five roles in creating values: honesty and responsibility, consciousness in debt repayment, a religious sense of value, responsibility towards society and the state, and prevention of fraud and forgery. Let us take them one by one.
Honesty and responsibility. When accounting methods are followed properly, corruption, fraud and misappropriation of assets are kept under control, and the transparency of the accounts rises. Followed year after year, this develops the sense of responsibility of the people concerned.
A religious sense of value. In the book's words, proper use of God-gifted resources and reducing unnecessary cost are part of religious values. When accounts are kept properly, the habit of cutting your coat according to your cloth grows, and the right use of resources is ensured.
Consciousness in debt repayment. Accounting makes borrowers aware of repaying what they owe and awakens their sense of value. As a result, the chance of becoming a loan defaulter falls.
Responsibility towards society and the state. VAT, customs duty and income tax are among the main sources of government income. Used properly, accounting finds the true income and expense, so the tendency to evade tax is reduced.
Preventing fraud and forgery. Where proper accounts are kept, the fear of punishment and disrepute reduces the tendency of officers and staff towards fraud, misappropriation of funds, cheating and other irregularities.
Now take some statements and say which role each one belongs to. Here it is statements being sorted, not people.
classifytap a chip
Which role?
Honesty and responsibility. Follow the methods and the accounts turn transparent; over the years that builds responsibility.
Consciousness in debt repayment. Repaying loans and a lower chance of default both belong to this one role.
A religious sense of value. In the book's words, proper use of resources and avoiding unnecessary cost are part of it.
Responsibility towards society and the state. When true income and expense are known, the urge to evade tax shrinks.
Preventing fraud and forgery. The fear of punishment and disrepute reduces the tendency to misappropriate.
All five roles seen. The two debt chips belonged to the same role.
3. What accountability is
Remaining responsible to a third party for your own work is accountability.
When the responsibility for a job is assigned to a specific person, that person can be held responsible for the result. Whoever holds the duty is the one asked to answer.
And without it? Great anarchy and decline appear in every economic and non-economic area.
4. Three kinds of accountability
The book describes accountability in three parts, a, b and c: (a) internal accountability within the firm; (b) accountability to owners, lenders and investors; (c) accountability to the government.
(a) Internal. In the modern decentralised system, particular people are given full power over income, expense and investment. The reason is that they can then give their full attention to the job and, when the accounting period ends, answer the questions of the higher authority. Put the sequence in order.
in ordertap in order
From empowerment to answering
Which is the first step?
Yes. And then?
Not yet. Attention follows power, there is no result before the work, and nothing to answer without results.
Right order. Power, attention, results, then the answer to the higher authority.
(b) To owners, lenders and investors. The people in accounting and management must answer these three on three points: whether the statements they prepared show the firm’s true picture; whether the invested money has been used properly; and whether the profit actually earned is in line with the projected profit.
(c) To the government. The concerned government authorities have a right to see whether the rules are being followed and whether duties, VAT and tax are being collected and paid properly. Keeping the books properly makes sure of this accountability.
See the three kinds of accountability together. Pick a question: who asks whom? Then take the books away.
who asks whompick a question
Three lines of accountability
Now sort the parties into the three boxes.
sort themchip, then box
Accountable to whom?
Pick up a chip, then drop it in a box. Ask: is this party inside the firm or outside it?
Right. Next one.
Not yet. Who asks questions at period end, and who has the right to check the rules?
All in place. The higher authority inside, owners, lenders and investors in the middle box, and the government outside.
5. Check yourself
Three questions in the exam’s style. Start with the first.
check yourselfpick one answer
Question 1
Responsibility to a third party for one's own work is-
Spending according to income is an effect of values, not accountability.
Development of responsibility is a separate role; responsibility to a third party is accountability.
Creating values is a separate matter. The book's answer: Accountability.
Right. The book says responsibility to a third party for one's own work is accountability.
For the second, call the five roles to mind.
check yourselfpick one answer
Question 2
A value is a standard that is formed on what basis of a person and society?
i. Thought and awareness ii. Belief iii. Perception
i and ii leave out iii; perception is a basis too.
i and iii leave out ii; belief is a basis too.
ii and iii leave out i; thought is a basis too.
Right. The book's definition has all three: thought, belief and perception.
For the last, think of accountability.
check yourselfpick one answer
Question 3
Which of the business's affairs do the concerned government parties have the right to see?
Right. The book says the concerned government authorities may see whether duty, VAT and tax are properly collected and paid.
Proper use of investment belongs to accountability to owners and investors.
Income and expense are internal; the government's right to see concerns tax collection and payment.
Financial results and position concern owners and others; the government's right is about tax.
The whole note on seven cards.
cut from the notetap to turn over
Seven cards
QuestionWhat is a value?
AnswerA standard formed over a long time from people's thought, belief and perception
QuestionHow many roles does accounting play in creating values, and what is the first?
AnswerFive; the first is development of honesty and responsibility
QuestionProper use of resources and avoiding unnecessary cost is part of which kind of value?
AnswerReligious value
QuestionAccounting raises borrowers' awareness about what?
AnswerRepaying the loan
QuestionWhat is accountability?
AnswerRemaining responsible to a third party for one's own work
QuestionWhich three forms of accountability does the book describe?
AnswerInternal; to owners, lenders and investors; to government
QuestionWho has the right to see whether duties, VAT and taxes are being paid properly?
AnswerThe concerned government authorities
Source: Accounting, Classes 9-10 (NCTB), Chapter 1 “Introduction to Accounting”, the “Role of accounting in creating a sense of values and accountability” part.