Accounting is a detailed business function wherein companies record, report and analyze financial transactions. This information commonly provides support for management decisions and investment decisions for external business stakeholders. Accounting information typically requires documentation for prepared accounting reports and statements. This documentation supports the accounting information and provides an individual with more documents or figures to assess the report.


Accounting manuals document the specific policies and procedures a company follows when handling financial information. In the United States, generally accepted accounting principles (GAAP) are the most authoritative accounting standards. GAAP is principles-based, meaning companies have a certain degree of latitude when applying the principles to their company’s financial information. However, business owners and managers typically create a manual to provide supporting documentation on the specific methods they use when applying GAAP. Publicly held companies must also disclose this information in their financial reports released to the public.

Transaction Information

Companies often require a certain amount of information or documentation for different financial transactions. For example, accounts payable clerks commonly include a purchase order, receiving ticket and vendor invoice when requesting the owner’s signature for a check. This documentation helps owners understand the purpose for the check and verify its accuracy and validity. Other transactions require similar documentation for accounting transactions. The date, amount, purpose of the transaction, signature of preparer, authorization signature and other information may be necessary for accounting transactions.

Audit Trail

An audit trail is often the most common documentation procedure in accounting. Audit trail information helps individuals see how the accounting department completes financial and accounting transactions. Computerized accounting systems have strengthened the audit trail process because most systems record a time/date stamp detailing the recording of transactions. Other audit trail procedures include providing the initial transaction document, handwritten notes pertaining to math checks or other calculations, journal entry copies, and a stamp indicating transaction receipt by the company or entry in the accounting ledger.