Accounting practices

"Introduction""No accounting system is very good, and all of them are infinitely variable*.”The purpose of this chapter is to discuss those facets of a typical accounting system which are most commonly encountered by operating managers in mineral processing plants. However, before concentrating in any detail on these it is important to understand the broad purposes and basic techniques of any accounting system in any major business.The three broad purposes of an Accounting System are:- Administering, controlling, and recording the flow of cash in and out of the business. Cash is, of course, converted into other assets (or stores of value) such as inventory, plant and equipment, etc. These assets also have to be administered, controlled and recorded.- Internal reporting to Management for information, for control, and for use in making business plans and decisions. - External reporting to stockholders, government, lenders and other outside parties.In this chapter we shall organize our discussion of accounting practice in mineral processing plants around these three purposes of accounting and focus in some detail on specific practices and techniques with which operating personnel will be routinely involved. This chapter is divided into the following: Accounting Basics; Administration, Control and Recording of Cash Flows; Internal Reporting; Planning and Budgeting; Cost Control; and External Reporting."