The Importance of Keeping Proper Accounting Record
It is very important that business owners make a habit of recording their business transactions every day. It will assist in making informed, efficient and precise decisions at any time.
Proper keeping accounting record involves maintaining up to date accounting system, which includes recording business transactions as they occur, as well as keeping important receipts or bills for substantiating all expenses incurred on behalf of the business. The advantages of keeping good accounting records can’t be overemphasized and some are:
Good accounting records act as backup for all income and business expenses incurred in time of audit
Without good records, tax auditors may be forced to make decisions based on their “best judgment” of what value the income and expenses may be, according to the size, location or type of a business. Additionally, without the right records, industry standards might be used as a guide in the audit of a business.
Good records shorten the length of time that an audit takes to be completed
If a business is chosen for audit, the business owner will be asked to produce the necessary backups to the info filed on the income tax return. Once the business operator has produced the right records, then the tax auditor will be able to examine the records provided and make a timely decision on the accuracy of those records. The auditor, will therefore spend less time at the business.
Good record keeping complies with the law
One of the main advantages of keeping good accounting records is to comply with the law. By simply being organized, businesses not only enjoy the above benefits, but also stay within the law.
Records keep owners informed about their businesses financial position
With the right records, a business owner can identify areas for expansion or improvements. Proper records also help the business owner to secure financing for the business. Additionally, proper analysis of records, can help in making strategic decision of changing business focus.
Avoid interest and penalties
Proper accounting records help business owners to avoid interest and penalties as they make it easier for them to pay the right amount of tax and at the right time. Penalties are here forever (if any), but proper records can help business owners avoid them. By the time the deadline comes, everything should be in good order ready for filing.
In conclusion, keeping proper business records can be seen as a daunting task at first. However, the key is to break the stuff down into series of manageable and straight forward tasks that can be accessed and updated at regular intervals to prevent paper work from piling up.
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Your accounting tasks are handled by patient and well-trained team. We are backed by committed personnel, professional auditors and accounting software house.
We help you cut down 30% overhead cost in hiring your own accounting team. With vast clientele pool, our fees are made reasonable and cost effective.
Dedicated manpower for bookkeeping and accounting tasks as well as full range of services. We are committed to account closing and tax deadlines to avoid regulatory penalty.
Our knowledgeable team is well-versed to finalise account within regulatory compliance. Patient in advisory for you with a supervising head assigned.