Considering Social Accounting?

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Social Accounting?

The vision of accounting as a numerical analysis technique has changed, and social aspects are beginning to be included in the formulation of the financial statements, which traditionally only had a budget and financial input.

Currently, the new trend includes social accounting balance, with human resources, intellectual capital and the environment, among others. This not only aims to inform about the social aspects of internal and external character. It is also used as a tool of business communication, decision-making and above all, control and definition of social policies in the company. This pays particular attention to its social projection, since today is an important element in the overall assessment of the company, which in the case of SMEs, has a great significance for achieving adequate funding.

The social accounting as accounting in general, in a changing world, responds to factors driven by environmental demands, whether that is strictly business, historical, cultural or political, and crosses new directions and trends. Among these we can find some trends worth noting.

First, the requirement of a social accounting integrated with the accounting systems that are well articulated with the accounting systems of financial, administrative and economic variables.

Second, can be through testimonials on various aspects of the company, such as its social and environmental responsibility.

Third, the accounting systems allow management accounts and social outcomes in terms of efficiency, equity, ethics and responsibility. Look up thecheapaccountant.co.uk for more great advice on this area.

Fourth, should refer to aspects that do not materialise in physical assets or materials inventories, but represent activities that add value to the company, and certain investments or strategies.

Finally, the social accounting should be based on databases where information is obtained to fit and will meet the needs of different users: from banks, investors or government, to customers and workers i.e., it must address the needs of all stakeholders.

In recent times, facing the increasing complexity of reality, social accounting should not only contemplate realities considered individually, but also from a wider perspective in order to see it as a dynamic and complex social system.

There is a risk that the various expressions of social accounting, such as environmental accounting is becoming a tool to legitimise certain actions rather than a reporting mechanism. This is because sometimes the spirit of productivity and growth without limits, contrast with the indisputable fact of the natural and finite system in which we live.

Lastly, we should insist that the report or social balance, in both terms is recognised and that the comprehensive management of the company, both internal and external, understand both aspects.

After all, social responsibility gives character and is a philosophy of the company, so that should not pose a task or be isolating. It should be a part of the very definition or concept of each company project. From that basic content can be deducted objectives and goals, which requires the participation to a greater or lesser extent, of the various parts.

From this perspective, the social balance can include tangible and intangible values although, strictly speaking, beyond the purely quantitative results.

Contact us today, The Cheap Accountant is a nationwide provider of business accounting advice and support. We offer free and impartial advice to all our clients, no matter how small or trivial your question dont hesitate to get in touch.

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