The necessity of accounting

Since commercial banks are business activities for profit, they are both actors, and business and entrepreneurship as legal persons. National Bank and commercial banks, like all other business entities are required to keep financial accounting of its activities and to prepare financial statements in accordance with the requirements of current legislation. The need to maintain financial records of all enterprises due to its significant social function. Economic efficiency in a market economy can only be provided to ensure equal access for market participants of financial information that enables each of the participants to draw conclusions about the expected profitability or unprofitability before conducting business operations and thereby avoid unnecessary loss of funds. Indeed, if the depositor, not having the financial information of low liquidity and low yields of the bank, deposit it in places, hoping only for a promised high interest rates, it risks losing money due to bank failure. Executives and managers of the bank information is needed to assess the financial health of the bank to develop a strategy for development of the banking business and the adoption of the current management decisions regarding the appropriateness of certain banking operations and the introduction of new banking products. Topic: The role of accounting in the management of the bank, its types and purpose | Tags: Financial Accounting