ACCOUNTING AND FINANCIAL MANAGEMENT DIVISION:
BOOKKEEPING AND ACCOUNTING
60% of Small Businesses and organisations DO NOT, maintain accurate records. Bookkeeping is one thing, but proper accounting quite another.
Transactions could be debited and credited correctly, but the accounting could be completely wrong! I.e .vehicle repayments. Bookkeeping:Credit-Bank, Debit-Vehicle payments. Accounting: Credit-Bank, Debit-Finance charges and liability(lease or HP-sale). Or insurance settlements or advances received, recorded as income when the credit portions could affect assets and liabilities respectively. All of the above have major TAX implications! Ignore accountants at your peril.
Without proper accounting the following problems surface:
• Absence of bank reconciliations, which leads to bounced cheques and debit orders.
• No creditors reconciliations, which leads to overcharges by suppliers.
• Debtors mismanagement: Cash flow problems, which inevitably results in the closure of business.
• Asset mismanagement: Theft of assets and under settlement of insurance claims, due to the absence of fixed asset registers.
• Stock pilferage.
• Should comply with IFRS.
• IFRS is much easier to understand, difficult to implement!
• Without proper record keeping, IFRS becomes impossible!
• Should be independently reviewed or examined
• Changes: Balance sheet, is now known as ‘’STATEMENT OF FINANCIAL POSITION, Income Statement, has become STATEMENT OF COMPREHENSIVE INCOME!
• Whilst bookkeeping is ignored, the criminals within your organisation, find loopholes in your system, and take advantage.
• Cash, inventory and assets are stolen
• At extra cost, to managers, forensic methods have to be employed to locate missing funds and assets.
• Proper FINANCIAL MANAGEMENT, is the basis of internal controls.
Free tax returns, for directors and principals of client firms.
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