Accounting is described as a comprehensive preparation of records of all financial transactions in a systematic way in a business. Since there are agencies that oversee activities such as auditing in a business as well as the entities required to collect tax, accounting may also include activities such as making summaries of the financial transaction reports, analysing them and making reports on all these transactions. Accounting is as important as any other department that helps in the running of an organization and depends on the size of the organization where accounts can be handled by accountants and bookkeepers for the small entities and a finance department with a number of employees for large companies. Learn more about Proper Financial Records at bookkeeping Orlando. Informed decision can be achieved when the financial reports provided give a true picture of how the business is performing. Individuals that are mandated with accounting activities in a business can do several roles such as bookkeeping and tax preparation.
In bookkeeping, the bookkeepers are required to record transactions that take place in the business such as sales, purchases, receipts or payments that have been made to an individual or another organization. There are various record books where a bookkeeper is required to record both the cash and credit transactions which includes the supplier’s ledger, daybook, customer’s ledger and the general ledger. Get more info about Proper Financial Records at tax preparation Orlando. It is through these financial records that an accountant is able to come up with reports on the financial situation of the business. Single-entry and double-entry bookkeeping system are the two common entry systems in bookkeeping. It is only the expense and income accounts can be recorded in the journal for expenses and revenue single-entry bookkeeping method. Double-entry bookkeeping method two entries for accounting are required to make records for the transactions and can occur in the liability, asset, expense, equity or the revenue accounts.
Appropriate tax returns can be filed for the business to the responsible body every year in the process known as tax preparation which is a role in the accounting field. Other people who can do the tax preparation includes tax preparer, certified public accountants, attorneys or even enrolled agents at a fee. Tax preparation through processes such as calculation of the total tax amount and filing the tax is crucial for a business which ensures that it is compliant to the laws of the region it operates.
Accounting persons need to possess certain qualities that indicate they are suitable to carry out their duties well. Professionalism and ethics are important and should be followed to the letter to ensure they do not expose financial information to unauthorized persons. Accountants need to have a proper communication ability both in written form and verbal to ensure that they have a clear understanding of all issues in pertaining to finances in the business. Accountants need to have a proper customer relationship to ensure that customers obtain proper services and the issues are tackled effectively.