Publisher's Synopsis
People carried out economic activities aimed at satisfying their needs (both of individual, families, and natural institutions) and organizing communities (sociopolitical institutions). While in the past needs satisfaction was mainly based on breeding, hunting, fishing, agriculture and, later on, on commerce (exchange of goods), after the industrial revolution a new institution appeared and developed: the enterprise, which goal is to leverage the capability of people to satisfy their needs. Using scientific, technological, organizational knowledge, enterprise activities combine limited resources to produce goods and services with a higher and higher usefulness that are sold to individuals and families (for private consumption), and to public administration (for public consumption). So it can be said that a third type of institution was added in the economic chain. Modern accounting systems are defined financial because the transfers of goods and services among institutions generate money inflows or outflows that are an objective measure of the economic value both for the seller and the purchaser (in market exchange or transaction) or both for public administration and tax payer from one hand, and donation and charity grant recipient and giver on the other hand (in non market exchange or transaction) . They have fourfold functions:
