Accounting and Book Keeping

Book-keeping is an art of identifying, approving, sorting and record-keeping company’s financial transactions in a manner that they can be retrieved and presented for the higher management reporting.

It is the process of recording financial transactions of business daily. It is a part of accounting process that records the financial affairs of the company in the form of journal entries. It is a means of entering data into the accounting system. Therefore, accurate, reliable and complete book-keeping becomes a significant source of information for any business. Gopal Tamhane & Associates is known for providing the best accounting and book-keeping services in Wagholi-Pune.

Components of Financial Statements that every business should maintain:

There are several crucial Financial Statement components that every business needs. It’s not just a compliance concern; they are vital tools to understand your business’s performance and financial health. The components of Financial Statements are as follows:

1: Income Statement

An Income Statement is a snapshot of the business’s income and expenses during a given period of time (e.g., quarterly, monthly, or yearly). It shows the organisation’s profitability and tells how much money the business has made or lost.

2: Balance Sheet

A Balance Sheet shows a business’s financial standing at a single point in time by displaying its assets, liabilities and capital. It shows the current value of a business, and by looking at the Balance Sheet, one can understand if the organisation can meet its financial obligations.

3: Notes to Financial Statements

Notes to Financial Statements give greater context around the information contained in your financial statements. For example, the assets may be listed in the Balance Sheet, but the notes to financial statements will precisely explain those assets, such as the depreciation charged on them, the components of those assets, etc. The information in this document is required to ensure that the business complies with standards and regulations.

4: Cash Flow Statement

A cash flow statement indicates the sources and utilisation of cash for a given period of time. The cash flow statement informs investors and creditors about the solvency of the business, where the business is receiving its cash from, and where it is spending it.

5: Statement of Change in Equity

This document shows the changes made to a company’s share capital, retained earnings, and accumulated reserves. For a sole trader, it shows changes to the owner’s equity. For a partnership firm, it shows the changes among the partners’ equity. In the case of a company, the statement of change in equity shows how equity share has changed among all the shareholders.

If you don’t know how to prepare the statements mentioned above, you can go for accounting outsourcing in Wagholi-Pune and hand over the responsibility of maintaining the books of your business to a trustworthy accounting firm in India that can provide you with expert accounting outsourcing services. If you are looking for the top accounting firms in Janakpuri, you can approach us, as we are one of the best accounting outsourcing companies in India and would be happy to serve you with the most satisfactory Accounts outsourcing services in Wagholi-Pune.

Importance of Book-keeping

• Organized Accounts:

An organized record of financial transactions plays an essential role in tracking their income/revenues and expenses.

• Timely Preparation of Financial Results:

With book-keeping, it becomes simple to prepare the financial statements, i.e., Profit and Loss Account, Balance sheet, Cash flow statements and Fund flow statements.

• Better Overview of the business:

Book-keeping provides an overview of the business from time to time and therefore, helps firms to examine their present situation.

• Future Planning and Action:

Book-keeping is the preparation of systematic accounts, which helps the businesses to shape up their future budget.
 

• Better Decision Making:

Book-keeping services are a must for analysing the financial data. They help in making profitable decisions. 

• Better Growth:

A business can grow, if you analyse the growth and profitability by tracking the financial records, which can be only proposed by the right book-keeping.

• Better Financial Management:

Book-keeping provides better answers to the questions such as where the organization spends money, to whom it pays, outstanding dues, outstanding payments, etc. It helps the organizations to manage their finances properly.

• Goal Planning:

To adhere to the goals, organizations need to concentrate on the result- achieving process along with the deviations. 

• Tax Planning:

The books of accounts managed effectively and efficiently can help in a detailed analysis of the financial transactions, which can be used for tax planning.

• Audit of Accounts:

Book-keeping provides well-defined and periodical data to the auditor by maintaining proper books of accounts which saves the auditee from any adverse remark in the audit report.

• Legal Requirement:

The law requires the businesses to maintain the books of accounts on a regular basis, it becomes imperative for the organizations to opt book-keeping services. 

Benefits of Accounting & Book-keeping

• Saves time
• Better accounts receivables and payables management
• Improves data security
• Minimizes risk
• Reduces overhead cost
• Better decision making
• Improved work quality
• High level of accuracy
• Increased profits and growth

Accounting and Bookkeeping at GOPAL TAMHANE & ASSOCIATES          

Appropriate book-keeping is decisive for keeping track of the financial performance of the organization. It facilitates the management to make informed decisions knowing how the organization is performing and what corrective actions are required.