What is Bookkeeping?
Does this question often arise when someone starts a new business that what is Bookkeeping? Basically it is the recording and organizing of financial transactions and accounts in a company. It ensures that all the record are correct, accurate, and up to date. Bookkeeping has to do on a daily basis for which accuracy is essential. To maintain the records of transactions and accounts is necessary for the growth of the business. Each transaction of sale and purchase are recorded in the ledger accurately and timely.
Tasks Of Bookkeeping:
Storing, recording, and retrieving of financial transactions are done by Bookkeeping Services. It is not only useful for business but all for the individual and non-profitable organizations. Following are some of the tasks involved in bookkeeping:
- Billing: All the bills of the products sold and the services provided by the company are given to the clients.
- Recording: All the records of receipts given and received from the customers are recorded in a Book know as a ledger.
- Verifying: The verification and recording of supplier’s invoices is also the task handled by bookkeeping.
- Paying: It is the responsibility of bookkeeping paying the entire suppliers bill and clearing all their payments.
- Processing: The employees pay, and all the tax-related issues are handled by bookkeeping.
- Providing: Annual financial report is provided so that who knows the position of the Business.
Importance of Book Keeping:
One of the main reason for business failure is “poor accounting.” There would be no track of your business without accounting or bookkeeping. It is important for the maintenance of accurate financial records. Below are some points which will prove the importance of bookkeeping:
- Helps in Budgeting: Bookkeeping organizes the income and expense properly creating a financial road map for your company so that you could plan your future expenses carefully.
- Track of Profit and Growth: Bookkeeping shows the profitability of your business and helps you keep track of its growth so that you could have a greater understanding of your business.
- Financial Management: With bookkeeping, it is easier to have control over your business finances. It gives you a clear picture of the money spent, outstanding invoices, and benefits of the company.
Bookkeeping services provide a lot of feasibility for the new emerging businesses owners, which all the newcomers should avail.