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

Public
areas: (1) Public Accounting, (2) Private Accounting, and (3)
Accounting:
Governmental Accounting.
La contabilidad
Public Accounting offers services to the general public on a pUblica en E.E.
fee basis. The Public Accountant may work for an individual, or U.U. esta dirigida
for a small or medium business. In this capacity he may set up al oak() en
accounting systems, provide management counseling service, general,
audit the accounts, express his opinion on the financial individuos y a la
statements, and/or prepare tax returns. He may work by himself pequena y
or join other accountants and form an Accounting firm or CPA mediana empresa.
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. CPA firm:
Estudio contable
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.
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 SEC: Es la similar
de la CONASEV en
regarding the content of financial statements and the reporting
E.E.U.U.
standards to be followed.
Internal Revenue Service (IRS): A governmental agency to
analyze and investigate the records of persons and businesses IRS: Es la similar
subject to income and other taxes. de la SUNAT.

General Accounting Office (GAO): An arm of the Congress

that audits government agencies and operations. It is similar as GAO: Es is
the Contraloria General de la RepUblica in Peru. similar de la CGR.

The Public Accountant in the United States is licensed as

Certified Public Accountant (CPA) and he has to pass a rigorous CPA: CPC

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 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:

TM
Castro de Bravo, Bertha (1994:1) TM
Weygandt, Jerry J. y Otros, (2000:29-30)
TM
Eisen, Peter J. (1995:1) TM
Costinett, Sandra (1977:5-6)
TM
Horngren, Charles T. y Otros, (1996:38-39)

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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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 e) The Accountant works for a single firm.
6. General Accounting Office f) The Agency that sets the standards for the
financial statements.

7. CPA 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. Every accountant is licenced as CPA by the AICPA easily.

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 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 in the United States.
4. A is a group of accountants who work together.
5. The largest accounting firms in USA are known as

6. A accountant woks in just one business and is included in

the
7. The entity that reviews all the is the IRS.

8. The entity that all governmental agencies is the GAO.

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

VOCABULARY
1. Accounting contabilidad, contable
15. Fee honorarios
2. Accounting firm estudio contable
16. Financial statements estados finan-
3. Accounts cuentas cieros
4. Arm extension 17. GAO Oficina de Contabilidad General
5. Audit auditar, auditoria 18. Governmental gubernamental, de go-
6. Best known mas conocidos bierno

7. Big four las cuatro grandes 19. Income renta, ingresos

8. Business negocio, empresa, corner- 20. Individual individuo

cial 21. Involved involucrado, envuelto
9. Content contenido 22. IRS Servicio de Renta Interna
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, administra-
ciOn, gerencial

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