Financial Record Keeping (eBooks)

By , March 2, 2012 9:12 PM

Financial success often depends on sound Financial Record Keeping that provides accurate, complete and useful information in a timely manner. Typically this involves:

  • Collecting information on Financial Transactions;
  • Journalizing and Posting the transaction information into Accounting Records;
  • Periodically Summarizing, Confirming and Reporting on Financial Status;
  • Periodically Reviewing Financial Reports, Developing Plans and Taking Action.

Getting into the habit of collecting information on your Financial Transactions is the most important step in maintaining sound Financial Records. Start by keeping a daily diary of transactions (including who, what, when and value of  for each transaction).

For example: whenever you receive a payment from anyone; issue them a receipt using a duplicate receipt book, this receipt book then serves as the daily receipts diary.

Another example: whenever you make a payment to anyone; issue them a cheque using a duplicate cheque book or a cheque book with cheque stubs (don’t forget to fill out the stub), this cheque book then serves as the daily payments diary.

For many  using a “Cash Basis for Accounting” these are the only source records required.

Note: More complex reporting requirements may require maintaing additional source documents like: Purchase Orders; Invoices; Packing Slips; Payment Vouchers; Tax Remittances; Payroll Stubs; etc.

 

The Basic Accounting Process:
Step 1 – Capture Transaction Data on Source Documents

Step 2 – Journalize and Post Transaction Data to Accounting Registers and Journals

Step 3 – Periodically Summarize and Verify Register and Journal Entries

Step 4 – Periodically Post Totals from Registers and Journals to Accounting Ledgers and Sub-Ledgers and verifying Account Balances

Step 6 – Reconcile Bank Balances from Banking Statements with corresponding Ledger Accounts

Step 7 – Prepare and Publish Financial Statements and Reports

   

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