All over the world, governments are concerned about their people struggling financially, saving too little and not having enough money set aside for their older age. A solution to these issues is widely touted to be financial literacy. Hundreds of millions are spent in financial literacy education. But what many don’t see or address is a root cause of financial illiteracy… accounting illiteracy.
Meanwhile, many students preparing for employment or promotion struggle to learn accounting. Yet recent education developments mean accounting can be much easier to learn.
The Accounting Literacy Foundation does two things: advocacy and access.
Accounting has had a bad rap for a long time. It has been seen as an obscure and boring subject. It's had a reputation for being hard to understand and learn.
Modern technology and educational developments have recently made learning accounting easy.
The advent of desktop publishing and color printing mean that accounting information can be presented graphically. Visual metaphors make accounting concepts easier to grasp, like the Macintosh made computers easier to use.
Accounting literacy is the ability to clearly understand and communicate financial situations and events. It manifests as the ability to read and make sense of financial reports such as balance sheets and income statements. Accounting literate people are able to see and describe financial matters with clarity. They can think clearly about money.
Modern life is financial life. Whether it is running a household budget, saving for retirement, starting or running a business, paying for education, or investing for the future… managing our lives is in large part managing our finances.
Being accounting literate is being able to clearly see a financial situation for what it is. You may or may not like what you see, but you see it clearly. Knowing where you are situated financially is the first step to changing your financial future. In other words…
To get ‘THERE’, I’d better know where's ‘HERE’.
Accounting literacy allows you to be with the status quo. Being clear on where you are and what’s come before makes you more powerful to change and control your life. Clarity about the present is the starting point for changing the future.
In all communities, accounting literacy is the first step towards financial harmony and a life that supports health, wellbeing and prosperity.
In developing communities accounting literacy education can offer additional benefits. Accounting skills can lead to employment as a bookkeeper or accountant, and this can mean the difference between life in a shack and middle class prosperity.
DIFFERENT FROM FINANCIAL LITERACY
Accounting literacy and financial literacy are not the same. Accounting literacy is a precursor of financial literacy.
Financial literacy is the ability to make sound financial decisions and manage your financial affairs. Financial literacy education typically covers topics such as
Accounting literacy comes before all of this. It deals with the elements that make up all of these issues.
Being accounting literate means being clear about
Many people’s financial woes are not due to a lack of understanding about investment products and suchlike. Rather, the root cause of people’s financial difficulties is first not being clear about the basic facts of their financial circumstances.
Accounting literacy is the foundation upon which financial literacy stands.
The Accounting Literacy Foundation believes that a lot of financial literacy education is less effective than it could be because it is not built on a foundation of accounting literacy.
The Accounting Literacy Foundation is an initiative spun off from Color Accounting International, an education and publishing company that operates as a social enterprise. (Social enterprises have a dual profit and not-for-profit purpose.)
The Foundation seeks to operate increasingly independently, with a view to incorporating and attracting widespread support from stakeholders in education, civil society, non-profit organizations, accountants, financial institutions and government.
We invite you to participate and engage with us.
CONTRIBUTORS AND COLLABORATORS
The following people and organizations provide pro-bono support for the work of the Foundation in the form of money, intellectual property, teaching time or other resources.
Contact us and join the mission to democratize accounting and spread accounting literacy. We welcome your energy, talents, resources, and belief in the power of accounting to set people free.
1622 Swann St NW
Washington DC 20009
United States of America
Phone +1 (202) 462 5000
© 2017 Accounting Literacy Foundation™ and CAI.