Both the fields of accounting and bookkeeping have two vital goals in common. They both aid in keeping track of expenses and income, thereby improving the odds of making a profit. Secondly they all bring together the required financial data about an individual’s enterprise thus enabling them to file the necessary tax returns and local registration papers of tax.
Bookkeeping in past was done by actual book keepers (the person responsible for keeping the company day to day finance record).As the length of the record increases chances of errors also increases , With the arrival of computers and Accounting Bookkeeping software, bookkeeping errors decreased and efficiency increased.
They both sound simple, don’t they? And they are more than ever if only a person reminds themselves of those two goals every time they consider they are beginning to be weighed down by the particulars of updating their fiscal records. Hopefully an individual can also rest assured of knowing that there is no requirement that their records be filed in any particular order. (Though, there is a straightforward prerequisite that enterprises ought to use a particular principle of crediting their accounts.) In not so many words, presently there is no official way of organizing a person’s financial books. As long as a person’s records accurately reflect on the status of their expenses and income, the IRS should not have a problem with.
When the procedures of accounting are broken down in three effortless steps that are easy to follow; the process of keeping books in order is easy to understand.
1) Keeping all acceptable records or receipts of payments made or received for all expenditures from an individuals business.
2) An individual ought to sum up their expenses and revenue records on an intermittent basis (The best way of doing this can be daily, weekly or even monthly).
3) Using the summarized records to create fiscal reports; the reports inform a person of all the specific information about their business, like how much in terms of profits is the business making or how much the business is worth at any given time.
Whether a person does their own bookkeeping by use of accounting software (Accounting Bookkeeping) or hand on ledger sheets, these doctrines are precisely similar.
