Analyze the relationship between business events and accounting.

Financial statements and transaction analysis

Both accounting and business events have a close relationship because both require the recording and tracking of data. Accounting is the process of recording all financial data about a business such as revenue and expense. It also provides insights into its financial health. Accounting events give context to why sales and purchases occurred. This allows for a better understanding of the financial picture. Additionally, these two aspects often intersect when it comes time to reconcile accounts at the end of an accounting period; since any discrepancies between records need to be explained in order for accurate entries to be made on a company’s balance sheet or income statement.

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