Accounting is the systematic process of recording, analysing and interpreting the financial transactions. It is the responsibility of every business – whether large or small to furnish their accounting records to the Income Tax Department. Usually, start-ups ignore and after few years, they have to face problems. To avoid problems like raid and fines, it is always good to maintain your financial records and furnish details to the government agencies.
An effective accounting system in place helps start-ups and established companies in:
1. Planning budget:
Budgeting helps organizations in effectively controlling the income and expenditure of the
company while monitoring the managerial policies and goals of the business. It provides a
disciplined approach to developing strategies; directing capital and other resources into
profitable channels.
2. Evaluating the performance of the business:
Accounting system acts as a yardstick in measuring the performance of the business with
respect to key metrics like net profit, sales growth.
3. Managing cash flow:
Regular tracking of the money that comes into the business helps in predicting the trends,
paying to staff and suppliers, covering debts, etc.
4. Presenting information to investors and stakeholders:
While approaching potential investors, creditors, banks or borrowers, the financial statements
and other reports serve as financial scorecards of the company. Investors will get a better
sense of the financial health of the business which includes the net worth, debts, savings,
amount spent on fixed expenses. In addition, they will get to know the solvency,
creditworthiness, liquidy, stocks and bond issuers of the business.
5. Mandatory by law:
In India, as the Registrar of Companies demands a strict record of income tax payments at the
end of the year, without maintaining accounts companies may end up paying tax in excess.
With the ever-changing business landscape, certified auditors and accounting professionals,
and payroll specialists assist in a broad spectrum of financial services that cover:
Basic financial consultation:
We have expert-chartered accountants and financial professionals who offer basic financial
consultation that your company needs.
Bookkeeping:
Bookkeeping is a process of recording financial transactions and information on a daily basis.
The account bookkeeping services may include payments made to suppliers, loan payments,
customer invoice payments, monitoring asset depreciation and generating financial reports.
Preparation of accurate annual financial statements and monthly reports:
One of the major concerns of creditors and investors is a company’s financial health.
Financial statements serve as a source for a company’s investor to gauge the profitability and
safety for their investment.
Financial statements, which include balance sheet, income statement and cash flow statement
give insights into the company’s financial position, an overview of assets and liabilities,
stockholders’ equity. It also helps understand the company’s revenues and expenditure, how
the company pays its debts and how it meets its expenses for operations.
Assistance in designing invoices:
Invoices are records of sale transactions that a company makes. They contain the details of
the shipment like the number of items, item description, total sale price and selling price per
item, terms of the sale, buyer’s and seller’s information, amount due, invoice number, method
of payment and the payment due date. Invoices establish the legal rights wherein if the
customer fails to make the due payment, the company can take it forward legally.