Bookkeeping is the process of recording, classifying and
summarizing financial transactions of an organization in a form, which is
easily understandable. It entails making records of day to day financial
transactions of an organization. Corporates are outsourcing bookkeeping
service to specialists and hence save time, improving efficiency by
concentrating on more important issues.
Types Of Bookkeeping Services
Single Entry System: The single-entry system of
bookkeeping is an 'Informal' bookkeeping system emphasizing on the
determination of profit and loss in organizations. A daily summary of all
the cash receipts and cash payments is made in this kind of bookkeeping
system. There is only one entry for each transaction. This system suffers
from various drawbacks and hence is no longer in use. A check book is an
example of single-entry bookkeeping system.
Double Entry System: The Double-entry bookkeeping system
is a 'Formal' bookkeeping system in which every financial transaction is
recorded twice. The double-entry system has built-in checks and balances and
is more accurate than single-entry system. It is self-balancing. This system
is a complete accounting system and focuses on the income statement and
balance sheet. Almost every organization follows the double-entry
bookkeeping system.
Benefits of Outsourcing Bookkeeping Service
- Organisations can concentrate on more important issues.
- Reduction in manpower requirement for maintaining books of accounts.
- Specialised personnel maintaining the books of accounts reduces
chances of errors.
- An organization can check its financial transactions and position
anytime.
