disclosure – producing accounting information with the aim to meet the needs of numerous financial report users.

Each corporate entity can be regarded as a business system, with the accounting system as one of the constituents. To enable the corporate entity to function smoothly, all its subsystems must be well connected and mutually compatible. Operating functions are mutually reliant and connected.

As regards the organisational aspect of accounting in a corporate entity, the following two organisational forms of the accounting function can be identified in the corporate entity:

o independent organisational unit and

o constituent of another organisational unit, mostly the Finance Department.

Depending on the size of the corporate entity, the accounting function can be organised as centralised or decentralised. In current business condition, when the national economic system comprises a large number of small and medium sized corporate entities, they often do not organise this function within, but rather outsource service of professional accounting agencies, which they entrust with keeping accounting records for a certain remuneration.

The modern-day business and economic practice has seen the emergence of new forms of organisation in accounting, based primarily on cost-effectiveness in the organisation of accounting, these new forms being (http://www.vikrevizija.hr/usluge/organizacija-racunovodstva.html,accessed April 10, 2014):

˃ in-house accounting service,

˃ outsourcing the services of accounting agencies,

˃ combination through outsourcing third persons and part-time work.

The in-house model of organising the accounting function means that the accounting function is within the corporate entity itself, performing all the tasks as required by the corporate entity, employing qualified staff, and featuring as a constituent of the corporate entity’s organisational structure. The outsourcing-based organisational model of organising the accounting function is almost dominant nowadays, in view of the increasing number of small and medium-sized corporate entities, who would find it cost-ineffective to organise their own accounting service, and therefore use the services of professional accounting agencies, who keep records of their operations and perform all the accounting operations for them, charging appropriate fees. The third model of approach to organising the accounting function includes hiring accountants who are retired, or employed in another corporate entity, to perform the accounting tasks. In order to fully accomplish all the tasks set before it, the accounting function must employ appropriate human resources. The staff are the core and essence of the accounting function. Professionally trained and educated staff can perform the tasks set before them with high-quality performance. An additional requirement is constant additional training of the current staff, which is an indispensable prerequisite for successful performance and functioning of the accounting function. At this point, it must be stressed that the

accounting staff are the foundation for successful performance of the tasks set before the accounting function. When performing tasks set before them, accountants should adhere to strict ethical requirements of professionalism, effectiveness and efficiency. This will contribute to the reputation of the entire profession, which has been somewhat compromised over the past period.

One of the forms of organising the accounting function within a corporate subject may be:

Graph 1: A model of organising the accounting function

(www.vus.hr/Nastavni%20materijali/Osnove%20menadzmenta/12.%20Poslovne%20i%20procesne%20funk cije%20u%20poduzecu.pdf, accessed April 15, 2014)

Graph 1 shows only the core, or the basic organisational structure of the accounting function. Each corporate entity, in accordance with its needs, divides this structure so that the accounting function can fully perform the set tasks.

The prerequisite for successful operation of every corporate entity is good cooperation between all three above mentioned systems of the business entity. Their close cooperation results in the fulfilling the corporate entity’s objectives. As a constituent element of these three systems, the accounting function monitors the movement of the total assets at the corporate entity level, and performs the accounting control of operations of all the organisational units in a corporate entity. This requires the accounting function to cooperate closely with other functions that it provides with necessary data on the other hand, while drawing the necessary data on the other. A well organised accounting function should provide data that are a prerequisite for economic and cost-effective operation of the corporate entity. Such an accounting function will supply information required by the management for successful operation, that is, provide the management of a corporate entity with the following information, which are not only prerequisite for high-quality business decision making, but also a prerequisite for the corporate entity’s survival (http://web.efzg.hr/dok/OIM/inacinovic/PRED%20Organizacija%20poslovnih%20funkcija.pdf, accessed April 25, 2014)

o periodic performance in production; o movement of assets

o sources of finance

o results of annual operation.

All the aspects of considering the accounting information are supposed to enable accomplishing the overall objective of this system, which is to establish a connection between the users of accounting information and the effects of earlier made business decision. This is due to the fact that each business decision is made based on relevant information that should result in certain effects.

ACCOUNTING FUNCTION MANAGER

ADMINISTRATOR MATERIAL ACCOUNTING MANAGER PAYROLL ACCOUNTING MANAGER FINANCIAL ACCOUNTING MANAGER