Bookkeeping & Accounting: An Overview

 

Bookkeeping is the practice of recording the business transactions in general ledger. This ledger contains all the financial transactions of the businesses since its inception.

On the other hand, Accounting is the practice of analyzing the information in the ledgers and developing insights into the business’s financial decisions.

Utility Of Bookkeeping & Accounting



There are various advantages attached to bookkeeping & accounting like:

  • Abide with the legal requirements: Maintaining of books of accounts is a statutory requirement. The details recorded in the books of accounts are required in filing of taxes in a time bound manner.
  • Helps management in decision making: Recording and maintaining books of accounts properly helps management to review the financial position of the organisation. Thus, results in to better decisions.
  • Ease in getting funds: By showing properly maintained and accurate books of accounts, one can surely attract investors to invest in their venture.
  • Managing Cash Flow:Regular tracking of the money that comes into the business helps in predicting the trends, paying to staff and suppliers, covering debts, etc.


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