The meaning of accounting, revisited Earlier in this chapter, a commonly used (but narrow)…

The meaning of accounting, revisited Earlier in this chapter, a commonly used (but narrow) definition of accounting was provided which said that accounting is the process of identifying, measuring and communicating economic information about an entity to a variety of users for decision-making purposes.

Do you agree with the above definition? Whether or not you agree with this definition of accounting will depend upon the answers you give to questions about:

• why an entity should collect and report information

• to whom an entity should report information

• what aspects of performance should be reported.

If you believe that the only accountability of an organisation relates to its economic (or financial) performance, then you might accept the above definition of accounting. But if you embrace a broader view of organisational responsibilities and accountabilities that also encompasses social and environmental impacts, then you are likely to reject this narrow definition of accounting.

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