Skip to main content

Record keeping and Bookkeeping

Introduction


As an Entrepreneur, you obviously will want to make a lot of profit. Profit comes from customers. When customers buy your products and services you are naturally entitled to make the profit. In order to attract customers, you need marketing plans and developed products and services. For which, you need capital. You also need to file tax returns. Capital comes from investors and other partners also. In the whole process, the one thing that has been there always is Capital. Capital or money undoubtedly forms an essential part in the smooth running of your business. But, when you are in a business, you obviously play with big figures. To ensure, proper working of your company you need to maintain these big figures. To maintain these big figures we need bookkeeping and record keeping. Mentioned below in detail is what do these two terms imply and how do they work.

Book keeping

Book keeping is nothing but the record of all the financial transactions of your company. It records each and every penny you have used, earned or spent under the name of your company. It is considered to be the subset of accounting. A bookkeeper is generally hired to maintain the records and entries. He generally works under the accountant of the company.

Record keeping

Record keeping is done keeping certain things in mind;
  • All the revenues and expenses made,
  • The Cash Expenditure in detail,
  • All Inventory records,
  • Accounts Receivable and Payable with every transaction and,
  • All the Tax Records.
When it comes to small business, its owner may use some kind of software to maintain all the records rather than hiring someone. However, when you talk about big companies, they have accountants and bookkeepers, sometimes more than one, depending upon the nature and size of the company. These records will help you maintain all your financial statements. Hence, your budget plan will remain more updated. The clear records will help you keep a clear tab on every investment you make. It will save your time and help you organize your cash in a more effective way.
Tracking your financial performance will become easy and less time-consuming. A proper table is maintained and entries are made on daily basis. There are two methods of making entries;
  • A single entry book keeping. Rarely used now-a-days.
  • A double entry book keeping. Double entry bookkeeping is preferred more and is more effective.
Your record keeping should be done in a way that it is easy to read. It is done for your convenience and hence should be easily readable for you. Every transaction should be mentioned, no matter how small it is. It will help you tackle any kind of money issue and dealing with investors will become a lot easier. We, at LegalRaasta, can provide you bookkeeping services.

This article has been contributed by Simmi Setia, Content Writer at LegalRaasta, an online portal for GST Software, GST Return Filing, GST Registration, Section 8 Company Registration, Nidhi Company Registration, IEC Registration, Fssai License, File ITR Online.

Comments

Post a Comment

Popular posts from this blog

5 Tips to Help Your Startup Operate Smoothly from Day 1

To pass the different stages of building a startup, you need not climb the treacherous mountains but pass through the valleys paved by others. Starting your own venture can be a quite daunting task. The can be like hurtling down a potholed road with the ups and downs and the unpredictability that takes extra efforts to overcome. It is good to heed the advice of the experienced people. It is always advised to take away from experiences of a person who has gone through the potholed road. To be an entrepreneur in competitive times like these can be a daunting and a demanding task. You need to give in all you have with zero complaints. The following are the best ways to get through the startup transition on day 1: 1. Keep your heart full, your mind clear and your body active You need to keep yourself well through the transition process. It’s good to take some time out for yourself. Do some physical activity, read in your free time and learn every time. You need to understand that...
1 comment
Read more

The marketing power of rewards problems

A rewards program can however help one to build customer loyalty, deepen the engagement and also serve as a marketing benefit one can tout in order to attract the new customers. Thus the article below gives a closer look as to how the business can thus leverage the consumer interest in the rewards, along with the best practices which one can adapt from the major brands’ most successful loyalty programs. The reasons are as follows: 1. Lead with a strong offer. Customers may however be willing in order to sign up for the rewards program, but it’s thus important in order to know that their membership thus doesn’t equate to loyalty. In fact, just 13 percent of the customers are however complete loyalists who thus never shop around. The rewards program should always be appealing enough to in order to entice the customers to want to sign up — and then use it repeatedly. One must consider as to how the rewards program could be structured in order to reward the customers when they thus agree ...
1 comment
Read more

Trends that will rule India's ecosystem in 2017

Although 2016 ahd however ended as a bonanza year for the fintech startups due to demonetization, 2017 so far it is however looking rather mixed. In 2017, the readers can however expect a consolidation which is required to be the underlying theme in the India’s startup ecosystem, with the country’s capital operators that will be continuing to realign their portfolios and also search for the exits. The purpose of this article is to make the reader aware of the 5 trends that will rule India’s startup ecosystem in 2017. The following are the 5 trends : 1. Continuity in the growth of SaaS One of the areas in which the investors will however continue in order to back is the players who are operating in the software-as-a-service (SaaS) industry. As it is however opposed to the horizontal SaaS – software technology which could however be used across the different industry domains, vertical SaaS thus caters to a specific vertical, like the hospitality or either retail. In order to fulfill the...
Post a Comment
Read more