What is the Significance of Business Law in Accountancy?

Posted by Edulyte on April 25th, 2021

Business Law is a study of the legal challenges and facets encountered by businesses of all sizes and types. It is an intellectually challenging subject that can prepare a student for a range of practice areas, including commercial litigation, tax, non-profit law, and more. 

If you are pursuing Accountancy, then Business Law becomes a significant part of other subjects. Why Business Law is important for Accountants is what we are going to emphasize upon in this post.  

How are Business Law and Accounts co-related? 

An accountant's job is not solely meant for data entry or to work on multiple journal entries. They are responsible for preventing civil and criminal liabilities that bring charges due to intentional or unintentional negligence or fraud. 

So, accounting is all about recording, reporting and verifying financial information. Business law helps bridge the gap between accounting practices and protecting the legal rights of the company entrusted. Without understanding the potential liabilities, an accountant will not be able to review their profession's work. An Accountant has to thoroughly understand everything about legal expectations when working on the client's records and reports. This is where Business Law plays a significant role in accounting practices.  

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