RK Associates provides computer-basedaccounting services. Many accounting tasks have been simplified with the helpof computer-based software. An Enterprise resource planning (ERP) system iscommonly used for a large organisation and it provides a comprehensive, centralized,integrated source of information that companies can use to manage all majorbusiness processes, from purchasing to manufacturing to human resources.
· What are the types ofaccounting?
· Requirements for Accounting.
· Whataccounting services do small businesses need?
· Do I need a bookkeeper or an accountant?
Accounting information systemshave reduced the cost of accumulating, storing, and reporting managerialaccounting information and have made it possible to produce a more detailedaccount of all data that is entered into any given system.
We as a service provider,relieve you from the day to day maintenance of books of Accounts. We offer tokeep & maintain books on your behalf at cost effective fees.
Various laws of India haveprescribed the requirement of maintenance of books of accounts. Section 128 ofCompanies Act 2013 prescribes as follows:
“Every company shall prepareand keep at its registered office books of account and other relevant books andpapers and financial statement for every financial year which give a true andfair view of the state of the affairs of the company, including that of itsbranch office or offices, if any, and explain the transactions effected both atthe registered office and its branches and such books shall be kept on accrualbasis and according to the double entry system of accounting.”
Various regulatory authoritylike IRDA, TRAI, SEBI, RBI have also prescribed their requirements.
There isfamous proverb in Hindi which translate as “first write then pay”. Everytransaction which take place need to be recorded so that any future disputemaybe avoided. Initially businessman used to record their transactions atsingle entry system or at their own discretion. By the time, recording methodshave changed. The most preferred accounting system now-a-days is double entrysystem. Double entry system has legal backing as governments and regulatoryauthorities prefer it.
Apart from above,Section 44AA of Income Tax Act 1961 has prescribed the requirements ofmaintenance of books of accounts which covers wider range of business entitiesunder it.
(1) Every person carrying onthe Legal, Medical, Engineering, Accountancy or Interior Decoration or anyother profession as notified by CENTRAL BOARD OF DIRECT TAXES (CBDT) arerequired to maintain such books of accounts & other documents as may enablethe Assessing Officer to compute Assesses total income in accordance withprovisions of this act.
(2) Followingare the persons who are required to maintain books of accounts: -
(i) Person carrying onbusiness or profession if his total income exceeds Rs.1,20,000 or his totalTurnover or Gross Receipts in the business or profession exceeds Rs.10,00,000in any of the 3 years immediately preceding the previous year.
(ii) Where the business isnewly setup, if his total income is likely to exceed Rs.1,20,000 or his totalTurnover, Gross Receipts likely to exceed Rs.10,00,000.
(iii) where the profits andgains from the business are deemed to be the profits and gains of the assesseeu/s 44AE or 44BB or 44BBB and assessee has claimed his income to be lower thanthe profits and gains so deemed to be the profits and gains of his business.
(iv) where the provisions ofsub-section (4) of section 44AD are applicable in his case and his incomeexceeds the maximum amount which is not chargeable to income-tax in anyprevious year.
Rule 6F: Booksof Account to be maintained:
Every person carrying onLegal, Medical, Engineering or Architectural Profession or Profession ofAccountancy or Interior Decoration or Film Artist or Authorized Representativeif his Gross Receipts exceeds Rs.1,50,000 in all the three years immediately precedingthe previous year or
Where the profession has beennewly set up in the previous year his gross receipts are likely to exceedRs.1,50,000 in that year.
BOOKS TO BEMAINTAINED
The following books of accounts and documents arerequired to be maintained : -
ü Cash book
ü Journal
ü Ledger
ü Carbon copies of the bills & receipts issued by theperson in relationto sums exceeding Rs.25
Original bills and receipts issued to the personinrespect of the expenditure incurred.
PERIOD FOR WHICH THE BOOKS& OTHER DOCUMENTS TO BE MAINTAINED
The above books of accountsand other documents shall be kept and maintained for a minimum period of 6years from the end of relevant assessment year. If an assessment in relation toany assessment year has been reopened u/s 147 all the books of accounts andother documents shall continue to be kept and maintained till the assessment soreopened has been completed.
PLACE WHERE BOOKS TO BEMAINTAINED
The books and documents shallbe kept and maintained at the place where the person is carrying on theprofession or where there is more than one place at the principal place ofbusiness.
What is the accounting services?
Accounting is the processof recording financial transactions pertaining to a business. The accountingprocess includes summarizing, analysing, and reporting these transactions tooversight agencies, regulators, and tax collection entities. The financialstatements used in accounting are a concise summary of financial transactionsover an accounting period, summarizing a company's operations, financialposition, and cash flows.
Accountingis one of the key functions for almost any business. It may be handled by abookkeeper or an accountant at a small firm, or by sizable finance departmentswith dozens of employees at larger companies. The reports generated by variousstreams of accounting, such as cost accounting and managerial accounting, areinvaluable in helping management make informed business decisions.
Thefinancial statements that summarize a large company's operations, financialposition, and cash flows over a particular period are concise and consolidatedreports based on thousands of individual financial transactions. As a result,all accounting designations are the culmination of years of study and rigorousexaminations combined with a minimum number of years of practical accountingexperience.
Whilebasic accounting functions can be handled by a bookkeeper, advanced accountingis typically handled by qualified accountants who possess designations such asCertified Public Accountant (CPA) or Certified Management Accountant (CMA) inthe United States. In Canada, the designations are Chartered Accountant (CA),Certified General Accountant (CGA), and Certified Management Accountant (CMA);however, all three will be unified under the designation Chartered ProfessionalAccountant (CPA) in the near future.
What are the types of accounting services?
Financial Accounting
Financial accountingrefers to the processes used to generate interim and annual financialstatements. The results of all financial transactions that occur during anaccounting period are summarized into the balance sheet, income statement, andcash flow statement. The financial statements of most companies are auditedannually by an external CPA firm. For some, such as publicly traded companies,audits are a legal requirement. However, lenders also typically require theresults of an external audit annually as part of their debt covenants.Therefore, most companies will have annual audits for one reason or another.
Managerial Accounting
Managerial accounting usesmuch of the same data as financial accounting, but it organizes and utilizesinformation in different ways. Namely, in managerial accounting, an accountantgenerates monthly or quarterly reports that a business's management team canuse to make decisions about how the business operates. Managerial accountingalso encompasses many other facets of accounting, including budgeting,forecasting, and various financial analysis tools. Essentially, any informationthat may be useful to management falls underneath this umbrella.
Cost Accounting
Just as managerialaccounting helps businesses make decisions about management, cost accountinghelps businesses make decisions about costing. Essentially, cost accountingconsiders all of the costs related to producing a product. Analysts, managers,business owners and accountants use this information to determine what theirproducts should cost. In cost accounting, money is cast as an economic factorin production, whereas in financial accounting, money is considered to be ameasure of a company's economic performance.
ØComplete and Systematic Record
ØDetermination of Selling Price
ØValuation of the Business
ØHelps in Raising Loan
ØEvidence in Court of Law
ØIn Compliance of Law
ØInter-Firm or Intra-Firm Comparison
ØFacilitates Audit
ØEffective Management
In most cases, accountantsuse generally accepted accounting principles (GAAP) when preparing financialstatements in the United States. GAAP is a set of standards and principlesdesigned to improve the comparability and consistency of financial reportingacross industries. Its standards are based on double-entry accounting, a methodin which every accounting transaction is entered as both a debit and credit intwo separate general ledger accounts that will roll up into the balance sheetand income statement.
What accounting services do smallbusinesses need?
üDay-to-day book-keeping.
üSubmit monthly / quarterly GST returns.
üReceivable / payable record.
üTax liability
üAnnual book preparation like Audit, Balance Sheet, Profit &Loss, MIS etc….
üIncome Tax Return
Do I need a bookkeeper or an accountant?
Every entity who wants toknow his business transaction as a receipt, payment, and reports likereceivable, payable, income, expenses, stock, etc… need to maintain the book.
Who summarizes his budgetand business grow target period.