Role of Accounting Information in Decision Making and Development of Businesses
The role of accounting information is very important in the management and decision-making of business activities. Changes in the economic system in our country after 90's from a centralized economy to a market economy, creation of the new entrepreneurships and businesses and increasing of the role of management in decision making, necessarily require a qualitative and reliable financial information. To enable sustainable business growth it is crucial possession of complete and accurate financial information, which might be provided by the accounting information system. Managers constantly faced with the problem of accurate information because of limited resources having a direct impact on the decision making. Therefore, it is important that the financial information that provides accounting, becomes available to managers for an efficient decision making at the right moment and optimization of the resources. Accounting information system is focused on the collection, processing, analysis and communication of financial information to external users such as: investors, creditors, banks, state authorities and internal users as shareholders and managers of the entity. It plays a crucial role in addressing of business challenges related with strategic direction, decision making, risk management, internal control, financial reporting, etc. Accounting supports and contributes to the sustainable development of a business activity in general and in particular to small and medium entrepreneurships. The performance and quality of accounting information, affecting the economic and financial stability, reduction of tax evasion and informality in the economy, encouragement of national and foreign investment, creating a friendly situation for business, as well as efficient management of resources the public and private sector. Through this study we have evaluated the role of accounting information in business decision- making and successful development of their activities.
Keywords - Accounting information, decision-making, economic development, financial reporting, profitability.