What is Social Accounting?

SOCIAL ACCOUNTING

What is Social Accounting?

The term 'social accounting' was first introduced into economics by J.R. Hicks in 1942, In his words, it means 'nothing else but the accounting of the whole community or nation, just as private accounting is the accounting of the individual firm'.Social accounting, also known as national income accounting. is a method to present statistically the inter-relationships between the different sectors of the economy for a thorough understanding of the economic conditions of the economy. It is a method of studying the structure of the body economic. It is a method of studying the structure of the body economic.

                  It is a technique of presenting information about the nature of the economy with a view not merely to get an idea of its prosperity, past or present, but also to get guidelines for state policy to influence or regulate the economy. In the words of Edey, Peacock and Cooper: "Social accounting is concerned with the statistical classification of the activities of human beings and human institutions in ways which help us to understand the operation of the economy as a whole. The field of studies summed up by the words 'social accounting' embraces, however, not only the classification of economic activity, but also the application of the information thus assembled to the investigation of the operation of the economic system." In other words, social accounting describes statistically the economic activities of the different sectors of the entire economy, which indicates their mutual relationships and provides a framework for analysis.