Overview of Accounting And Bookkeeping
Bookkeeping is the process of recording all daily financial transactions of a business.Accounting is the process of analyzing, summarizing, and reporting financial data to understand the business's financial health.
Who is applicable for Accounting And Bookkeeping
Freelancers and Sole Proprietors
Non-Profit Organizations
Online/E-commerce Businesses
All Businesses (Small, Medium, Large)
Startups and Growing Businesses
Public and Private Companies
Independent Contractors
Businesses Seeking Funding or Loans
Taxpayers with Complex Finances
Benefits of Accounting And Bookkeeping
1. Keeps Financial Records Organized
Helps you track and manage all your financial transactions.
2. Ensures Compliance
Makes sure your business follows tax and legal requirements.
3. Helps Make Informed Decisions
Provides accurate financial information to guide business choices.
4. Saves Time
Reduces the time spent on managing finances and preparing reports.
5. Improves Cash Flow Management
Helps to track income and expenses, ensure you have enough cash for operations.
6. Prevents Fraud and Errors
Regular record-keeping helps to spot mistakes and avoid fraudulent activities.
7. Supports Business Growth
Accurate financial records are crucial for securing funding or attracting investors.
8. Eases Tax Filing
Makes it easier to file taxes accurately and on time.
Documents Required for Accounting And Bookkeeping
- Invoices (Sales & Purchases)
- Receipts
- Bank Statements
- Credit Card Statements
- Payroll Records
- Receivables and Payables Reports
- Tax Documents
- Loan Statements
- Expense Reports
- Contracts and Agreements
- Cash Flow Statements
- Inventory Records
- Fixed Asset Records
Step-by-Step Process for Accounting And Bookkeeping
1. Collect Financial Documents
Gather all necessary documents such as invoices, receipts, bank statements, and payroll records.
2. Organize Documents
Sort documents into categories (e.g., income, expenses, assets, liabilities) to keep records organized.
3. Record Transactions
Enter daily financial transactions in bookkeeping system (e.g., accounting software or ledgers). Include sales, purchases, payments, and receipts.
4. Reconcile Accounts
Compare bank statements with the financial records to ensure that they match. Correct any discrepancies if any
5. Update Financial Statements
Regularly update key financial statements, such as the income statement, balance sheet, and cash flow statement.
6. Track Accounts Payable & Receivable
Keep track of money owed to the business (accounts receivable) and payments due (accounts payable).
7. Calculate and Record Taxes
Track Gst and income tax. Ensure that they are correctly recorded for reporting purposes.
8. Review Financial Records
Periodically review records for accuracy, ensure all transactions are properly logged and categorized.
9. Prepare Financial Reports
Generate reports like profit and loss statements, balance sheets, and cash flow statements to monitor business performance.
10. File and Store Records
Safely store all financial documents (physical or digital) for easy access and future reference, ensuring compliance with tax laws.
11. Ongoing Monitoring and Updates
Continuously monitor financial activities and update records regularly to maintain accurate bookkeeping.
Frequently Asked Questions
Audit Support
Income Tax Return Filing
Business Registration
GST Registration
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