Accounting and Bookkeeping

Accounting or bookkeeping plays a significant role in operating a business in keeping track of expenditures & incomes. Accounting or bookkeeping ensures accurate statutory compliance and offers investors, management, and government quantitative financial information that helps companies to make various important decisions.

The gratuity becomes payable when an employee leaves the organization for any of the following reasons: • Retirement or superannuation • Termination or resignation • Disablement or death due to an accident or disease • Layoffs or retrenchments • Voluntary Retirement Scheme.

In financial terms, Bookkeeping and Accounting are almost used interchangeably though both concepts are different and can be daunting tasks for companies considering the nature of their operations and the availability of resources. Bookkeeping is defined as the recording of financial transactions, accounting deals with the analysis, interpretation, reporting, classification, and summarization of the business financial data. Whereas, Accounting is the systematic process of recording, measuring & communicating information about the financial transaction in a business. Accounting helps in identifying the financial position of a company and showcase to the stakeholders.

Accounting or bookkeeping plays a significant role in operating a business in keeping track of expenditures & incomes. Accounting or bookkeeping ensures accurate statutory compliance and offers investors, management, and government quantitative financial information that helps companies to make various important decisions.

In financial terms, Bookkeeping and Accounting are almost used interchangeably though both concepts are different and can be daunting tasks for companies considering the nature of their operations and the availability of resources.

Bookkeeping is defined as the recording of financial transactions, accounting deals with the analysis, interpretation, reporting, classification, and summarization of the business financial data. Whereas, Accounting is the systematic process of recording, measuring & communicating information about the financial transaction in a business. Accounting helps in identifying the financial position of a company and showcase to the stakeholders.

The primary processes of accounting are:

• Data Communication
• Data Identification
• Data Recording

Yes, businesses of all sizes and categories require accounting and bookkeeping services for preparing, estimating, and maintaining proper records of tax returns, finance, and transactions. This requires outsourcing accounting and bookkeeping to professionals or hiring an outsourcing firm with expertise in assisting the company with end-to-end support. 

Accounting software is developed for keeping track of the cash outflows & inflows of a company. There is various kind of accounting modules through which software functions, such as Account Payable, Account Receivables, General Ledger, etc. The software also manages reporting and payroll systems.

There are primarily 5 managerial functions in accounting:

• Cost control.
• Formation of planning & Managing of financial policy
• Preparation of financial budget.
• Assessment of employee’s performance.
• Prevention of frauds & errors. 

Bookkeepers play an essential role in a company for taking care of the client’s general ledgers. Bookkeepers’ most important responsibilities are:

• Compiling data daily
• Sorting expenses in the general ledger
• Reviewing and assessing the general ledger to maintain accuracy and avoid mistake
• Reconciling bank statements in contradiction of the general ledger
• Creating financial statements

1. Cheque Preparations
2. Bank Reconciliations
3. Accounts Payable
4. Expense Reports
5. Accounts Receivable
6. Financial Statements
7. Payroll

Hiring an in-house expert can be comparatively expensive and time-consuming. Also, it is very important to understand the financial burden to in-house employees that directly affect the company's growth. You need to pay your salary on time and manage associated costs like office equipment, employment taxes, office space, payroll, etc. These can be stressful. Outsourcing Accounting and Bookkeeping can reduce the burden on a company with several other benefits. The experts are knowledgeable and experienced enough handling for multiple companies and manage stress smoothly and accurately.