The Bookkeeping Services and Their Usefulness in the Present Day Accounting System
The term ‘bookkeeping’ means recording of all the financial transactions that are taking place in a company. It might seem that the process of bookkeeping is same as that of the accounting, but the two processes are entirely different. The work done by the bookkeeper in making the entries in the book are used by the accountant in order to prepare the various financial reports of the company that are then shown to the various government agencies. A bookkeeper also known as the accounting clerk and the accounting technician is the person who makes the entry into the books regarding all the financial transactions that take place in the company. The bookkeeper performing the bookkeeping services for the company records the day to day transactions of the company into the day books. All the entries like the sales, purchases, payments and receipts are recorded carefully in the books.
The bookkeeping services that are done by the bookkeeper bring the books to the trial balance stage. From this stage onwards the accountant prepares the balance sheet as well as the income statement for the company. There are various methods that are used by the bookkeepers to make entry into the books of the company. These systems are the single entry bookkeeping systems and the double entry bookkeeping systems.
The Single Entry Bookkeeping System: The cash book is one of the primary methods of the single entry bookkeeping system. The account records for petty cash, accounts payable and receivables and other transactions like inventory and the travel expenses are recorded separately. In these times there are many types of software available that have eased the process of the single entry bookkeeping services.
The Double Entry Bookkeeping System: In the double entry bookkeeping system every transaction or event impacts atleast two different accounts. In the present day accounting system the terms of debits and credits are used within the accounting equation, assets=liabilities+ equity. This equation serves as an error detection system in this type of bookkeeping services. If at any point the sum of debits is not equal to the sum of credits then there is an error. Although not completely error free, the double entry bookkeeping services is one of the most popular bookkeeping services.
The bookkeeping services are one of the most important aspects of maintaining the accounts of the company. It is required that the bookkeeper that is hired to do the bookkeeping is honest, has integrity, as well as is competent enough to do the job efficiently.