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.
