It is a sad fact that the primary cause for failed businesses is the inability to keep a firm hold over cash flow and financial record keeping. In fact, many small business owners do not even know their day to day financial status. In this way it is easy to over extend the business or to allow debts to grow to unacceptable levels. With help from a reliable bookkeeper Northamptonshire businesses can make sure that they keep proper records and remain informed at all times.
It is in the interest of any enterprise to keep their books in order and they can derive many benefits from doing so. However, it is also a legal requirement to keep record of all financial transactions. Businesses that fail to do so can expect very heavy penalties and they may even be forced to close down. Certain types of businesses have an obligation to even publish their financial results on a year to year basis.
Some people think that bookkeeping is a complicated affair. This is not the truth. In essence, bookkeeping is simply the art of recording all the financial transactions of an organisation. In most cases, these transactions involve either expenditure or income. Most businesses keep record of these transactions in various categories. As far as income goes, for example, they may want separate records for income that came from the sale of goods and income that was derived from selling assets.
In modern times a double entry bookkeeping system is used by most enterprises. This simply means that every transaction has two entries in the books. For example, if a business purchase stock the amount will be recorded in the bank account as an expense but at the same time the amount is also recorded on the positive side of the stock account.
Bookkeeping is as old as the human race. Records of transactions have been kept from the earliest ages. Of course, those days when transactions were carefully entered into giant ledgers are now long gone. These days businesses use advanced software packages to keep their books. Most software packages make it easy to compile reports, to correlate entries and to produce information as and when it is needed.
There is still a misconception about the difference between accountancy and bookkeeping. Bookkeepers are there to keep the records. They are not employed to interpret those records. Accountants, on the other hand, are qualified to look at the records and to interpret them in various ways. Accountants prepare budgets, create forecasts and evaluate management decisions in terms of financial prudence.
Bookkeeping helps organizations to avoid fraud. In fact, most cases of fraud are only proven once the financial records are studied. Proper records can also help an organization to avoid legal problems and to respond to enquiries quickly. When a business is sold or bought the financial records will play a very big role in the determination of the price.
It is money and the management thereof that makes a business work or fail. Accurate records are therefore of prime importance. Without such records it would be neigh impossible to make sensible decisions.
It is in the interest of any enterprise to keep their books in order and they can derive many benefits from doing so. However, it is also a legal requirement to keep record of all financial transactions. Businesses that fail to do so can expect very heavy penalties and they may even be forced to close down. Certain types of businesses have an obligation to even publish their financial results on a year to year basis.
Some people think that bookkeeping is a complicated affair. This is not the truth. In essence, bookkeeping is simply the art of recording all the financial transactions of an organisation. In most cases, these transactions involve either expenditure or income. Most businesses keep record of these transactions in various categories. As far as income goes, for example, they may want separate records for income that came from the sale of goods and income that was derived from selling assets.
In modern times a double entry bookkeeping system is used by most enterprises. This simply means that every transaction has two entries in the books. For example, if a business purchase stock the amount will be recorded in the bank account as an expense but at the same time the amount is also recorded on the positive side of the stock account.
Bookkeeping is as old as the human race. Records of transactions have been kept from the earliest ages. Of course, those days when transactions were carefully entered into giant ledgers are now long gone. These days businesses use advanced software packages to keep their books. Most software packages make it easy to compile reports, to correlate entries and to produce information as and when it is needed.
There is still a misconception about the difference between accountancy and bookkeeping. Bookkeepers are there to keep the records. They are not employed to interpret those records. Accountants, on the other hand, are qualified to look at the records and to interpret them in various ways. Accountants prepare budgets, create forecasts and evaluate management decisions in terms of financial prudence.
Bookkeeping helps organizations to avoid fraud. In fact, most cases of fraud are only proven once the financial records are studied. Proper records can also help an organization to avoid legal problems and to respond to enquiries quickly. When a business is sold or bought the financial records will play a very big role in the determination of the price.
It is money and the management thereof that makes a business work or fail. Accurate records are therefore of prime importance. Without such records it would be neigh impossible to make sensible decisions.
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