Accounting, as an information system is the process of identifying, measuring and
communicating the economic information of an organization to its users who need the
information for decision-making. It identifies transactions and events of a specific entity. A
transaction is an exchange in which each participant receives or sacrifices value (e.g. purchase
of raw material). An event (whether internal or external) is a happening of consequence to an
entity (e.g. use of raw material for production). An entity means an economic unit that performs
economic activities