Accounting can be defined as the art of classifying, recording and summarising transactions and business events in the monetary terms and interpreting and communicating the results to interested parties to enable them to make decisions.

Bookeeping is different from accounting as it is only part of accounting which stresses on the recording of business transactions.

It is the activity of keeping full documentation of every single financial transactions of the entity to form a base for the accounting process.

Internal users are those who work in a organisations or corporations such as owners, managers and employees.

Meanwhile, External users are those who are indirectly involved with the organisation such as creditors or bankers, current and potential investors, the government and consumers of products or services.

Sole proprietorship is a business owned and run by one individual with no legal distinction between the owner and business. So, it is managed and controlled by one owner.

Corporation or company is a business entity that is owned by its shareholder(s), who then elect a board of directors to oversee the organisation’s activity.

Limited company or corporation have limited liability.

If the business fails and the company’s assets are not enough to cover the debt, the payables or bankers have no right against the shareholders’ personal properties or belongings.