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Lilia

Evelyn Guzman

Vidal

ACCOUNTING Accounting as it is known now, began with the development of the commercial republics of Italy. In 1340, Massari of Genoa was the first to keep double entry books according to Edward Peragollo. But, the first printed text that contained accounting and included the double entry system was the one by Luca Pacioli (1445-1514). Since then, accounting has been defined as a science of recording, classifying and analyzing financial information. It has also been called the Language of Business. Accounting, in the United States, may be divided in three main areas: (1) Public Accounting, (2) Private Accounting, and (3) Governmental Accounting. Public Accounting offers services to the general public on a fee basis. The Public Accountant may work for an individual, or for a small or medium business. In this capacity he may set up accounting systems, provide management counseling service, audit the accounts, express his opinion on the financial statements, and/or prepare tax returns. He may work by himself or join other accountants and form an Accounting firm or CPA firm. In the United States the four largest Accounting firms that audit most of the largest and best known corporations in the world are known as the Big Four. Private Accounting is when an accountant works for a single enterprise as a part of the personnel of the business and is included in the payroll. He may prepare reports, supervise the recording of business transactions, and prepare statements for management and other interested parties. He also prepares tax returns and reports required by government agencies.

Public Accounting: La contabilidad pUblica en E.E. U.U. esta dirigida al oak() en general, individuos y a la pequena y mediana empresa.

CPA firm: Estudio contable

Governmental Accounting is the accounting for the State or a governmental agency. The main governmental agencies in the United States related to accounting are: Securities and Exchange Commission (SEC): A governmental agency deeply involved in accounting, establishing requirements regarding the content of financial statements and the reporting standards to be followed.

SEC: Es la similar de la CONASEV en E.E.U.U.

Internal Revenue Service (IRS): A governmental agency to analyze and investigate the records of persons and businesses subject to income and other taxes.

IRS: Es la similar de la SUNAT.

General Accounting Office (GAO): An arm of the Congress that audits government agencies and operations. It is similar as the Contraloria General de la RepUblica in Peru.

GAO: Es is

The Public Accountant in the United States is licensed as Certified Public Accountant (CPA) and he has to pass a rigorous

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similar de la CGR.

CPA: CPC

TECHNICAL ENGLISH I

examination to get the license to practice. This examination is administered twice a year by the American Institute of Certified Public Accountants (AICPA) and is required by all states in USA. READING ADAPTED FROM: Castro de Bravo, Bertha (1994:1) TM Eisen, Peter J. (1995:1) TM Horngren, Charles T. y Otros, (1996:38-39) TM

TM TM

Weygandt, Jerry J. y Otros, (2000:29-30) Costinett, Sandra (1977:5-6)

DIALOG LUIS: Do you know if there is any difference between the Public Accountant here and in the United States?

TOM: Of course! In the .States the Public Accountant works for anyone who needs an Accounting Service and not for the State as we do in Peru.

LUIS: So, if I say that I've worked in Public Accounting they won't understand that I've really worked for the Government.

TOM: That's right. If you want to express the idea of working for the Government you must introduce yourself as a Governmental Accountant.

LUIS: Oh! I see! Then, I can be able to work in an Accounting Studio. TOM: No, Luis. In English it isn't an Accounting Studio. It's a CPA firm or Public Accounting firm.

LUIS:

Well, I really need to know more about Americans and the way they work. =MN

SUMMARY Accounting has been defined as a science of recording, classifying and analyzing financial information. Accounting may be divided in three main areas: (1) Public Accounting, (2) Private Accounting, and (3) Governmental Accounting. The Public Accountant offers his services to the general public on a fee basis. In the United States the four largest Accounting firms that audit most of the largest and best known corporations in the world are known as the 4( BIG

FOUR*. -

The Private Accountant is employed by a single enterprise The Governmental Accountant works for a governmental agency. SEC (Comision de Valores y Cambios) = CONASEV IRS (Servicio de Renta Interne) = SUNAT GAO (Oficina de Contabilidad General) = CGR CPA (Contador PtIblico Colegiado) = CPC

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29

lia Evelyn Guzman Vidal

EXERCISES A: Match the words on the left with their definition on the right 1.

Public Accounting

a) The Governmental Agency that collects taxes from individual and businesses.

2.

Private Accounting

b) A group of Accountants that work together and offer their services on a fee basis.

3.

Governmental Accounting c) The area of Accounting that works for the general public.

4.

Internal Revenue Service d) The Governmental Agency that controls the Accounting for the governmental agencies.

5.

SEC

6.

General Accounting Office f) The Agency that sets the standards for the financial statements.

7.

CPA firm

e) The Accountant works for a single firm.

g)The Accountant works for the Government.

B: Answer the following statements as true or false 1. Accounting originally began in France. 2. Luca Pacioli was the first to keep double entry books. 3. Accounting is also known as The Language of Business. 4. Public Accounting is for the general public. 5. Private Accounting is only for small businesses. 6. There are five largest CPA firms in USA. 7. The SEC collects all the taxes. 8. The IRS is like CONASEV in Peru. 9. The GAO controls the governmental agencies expenses. 10.

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Every accountant is licenced as CPA by the AICPA easily.

TECHNICAL ENGLISH I

C: listen carefully and fill in the blanks 1. The first to keep

books was Massari of

2. Accounting is

as the Language of Business.

3. The public accountant works for 4. A

in the United States.

is a group of accountants who work together.

5. The largest accounting firms in USA are known as 6. A the

accountant woks in just one business and is included in

7. The entity that reviews all the 8. The entity that

is the IRS. all governmental agencies is the GAO.

9. The entity that establishes the the SEC. 10. Public accounting in USA is not like

for the

is

in Peru.

VOCABULARY 1.

Accounting contabilidad, contable

2. Accounting firm estudio contable

15. Fee honorarios

3. Accounts cuentas

16. Financial statements estados financieros

4.

Arm extension

17. GAO Oficina de Contabilidad General

5.

Audit auditar, auditoria

6. Best known mas conocidos

18. Governmental gubernamental, de gobierno

7. Big four las cuatro grandes

19. Income renta, ingresos

8.

Business negocio, empresa, cornercial

20. Individual individuo

Content contenido

22. IRS Servicio de Renta Interna

9.

21. Involved involucrado, envuelto

10. Counseling asesoria

23. Keep Ilevar, guardar, mantener

11. CPA firm estudio contable

24. Language lenguaje

12. Deeply muy, profundamente

25. Licensed licenciado, titulado

13. Development desarrollo

26. Main principal

14. Double entry partida doble

27. Management gerencia, administraciOn, gerencial

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