Just What is Accounting Anyway?

Untitled

Sunset in Beaufort, North Carolina

You love travel.

That’s probably the main reason you became a travel agent, isn’t it?

I bet sometimes you enjoy your job so much that it’s not even work anymore (especially when you’re on that next Jamaican FAM)!

Why should you care about accounting?

Accounting…ugh

Mere mention of the word can bring about a visceral negative reaction in most travel agents. At the word “accounting,” many travel-lovers completely tune out. It’s as if the person talking about accounting is speaking a different language.

And that’s exactly what the accounting is, a different language.

Accounting…different language…foreign country…international travel…it just doesn’t quite work, does it, making that connection between accounting and travel?

And yet…

You wouldn’t travel to a foreign country without learning a little of the native tongue, would you?

Accounting has its own vocabulary, its own grammar, its own rules, and if you don’t speak a little bit of the language it can be quite mystifying.

But, if you speak the language, things go much more smoothly.

Many consider accounting to be the language of business. If you are going to succeed at business, especially if you are an entrepreneur (say a travel agency owner, for instance), you have to at least understand the basics of that language; you have to understand the basics of accounting.

Think of how much more enjoyable international travel is when you speak a little of the language.

If you understand the basics of accounting – if you speak the language – you can delegate those accounting tasks you might hate to a CPA, an employee, or a partner without that nagging pain, that loss of control that comes from delegating something you don’t understand.

Speak the langauge. Know a bit about accounting so you can concentrate on what matters – your passion. Travel.

Knowing a bit about accounting will also help you enjoy leisure because you’ll worry less about things that you understand. Less worry, more leisure.

This doesn’t mean you have to be able to do accounting yourself, that’s what accountants are for. You just have to understand it well enough to delegate and know that you are getting the results you need.

I was 30 years old before I ever took a formal accounting course.

Before that, if someone told me I would be a CPA one day I might have taken a swing at her.

Fifteen years on, I am a Certified Public Accountant and a Certified Fraud Examiner, and I actually understand accounting rather well.

Seriously, at 30 years old I had no idea what a debit or a credit was. I didn’t have a clue how to read a set of financial statements, much less put a set together. I had no idea what assets or liabilities were, and all I knew was that I wanted nothing to do with accounting.

One of the keys to getting your mind around accounting is to understand exactly what accounting really is.

As a travel agent, you love travel.

You’re not just a travel agent, you’re an entrepreneur and a business owner. Accounting is a significant part of the entrepreneurial landscape.

Unlike travel, I’m going to guess that you don’t love accounting.

That’s understandable. After all, accounting can be a bit dull.

I’m a CPA and I don’t really love accounting, but I speak the language. I also quite enjoy helping non-accountants – especially travel agents – learn to talk accounting.

AccountantSea is all about understanding accounting in the setting of the travel business. Developing a simple definition of accounting is a great place to start learning the language.

Before defining accounting though, I want to lay out one truth for you (knowing that math intimidates many).

Accounting is not math.

Accounting and math are two different things and to understand accounting you need no more math than simple addition and subtraction. For that matter, to be a good CPA you only need to do the basics of math with maybe an occasional simple algebraic equation thrown in. Just remember accounting and math are not the same, and you only need the most basic of math skills to understand accounting.

What is accounting?

While the question may be shrouded in mystery, the answer is really simple:

Accounting is a system for tracking and reporting the results and activities of an organization…no more, no less.

Keep that simple definition in mind and you’re on the way to speaking the language of accounting.

One more time:

Accounting is a system for tracking and reporting the results and activities of an organization.

From that definition we can conclude that:

  • Accounting is a system
  • Accounting tracks and reports results and activities

Accounting is simply a method of tracking and reporting results. No more, no less.

It is a system though, and like any other system accounting has its own particular rules and practices. Once the basics of those particular rules and practices are learned anyone can understand accounting information. Anyone can speak the language.

One last time:

Accounting is a system for tracking and reporting the results and activities of an organization…no more, no less.

Keep that definition in mind, and you’ll be fluent in no time!

The Travelers Guide to Tax Deductions, get it just for signing up!

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>