General Accounting
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What is General Accounting?
Recording of financial transactions is called accounting. In business entities, transactions generally related to sales, purchase, revenue income, revenue expenses, capital income, capital expenses, cash transactions, bank transactions etc.
Why Every Business Entity Should Maintain Its Accounting?
Out of the many objectives of business entities, earing profits and business growth are main objectives. It is about impossible to know the profit earning and measure the growth of business without accounting. Through accounting, a business owner can easily track its business that where it is going.
Apart from personal objectives of accounting, there are some legal obligations to maintain accounting records.
Accounting under Income Tax Law
Section 44AA of Income Tax Act, 1961 every person has to maintain its accounting records if he/she carrying the profession of:
- Legal Services
- Medical Services
- Engineering Services
- Architecture Services
- Accounting Services
- Technical Consultancy Services
- Interior Decoration Services
Apart from these professions, if a person is carrying out other professions or business activities and his/her income from that profession exceeds rupees one lakh to twenty thousand or his/her gross turnover or receipts exceeds rupees ten lakh.
Accounting under GST Law
Section 35 of Goods and Services Tax Act, 2017 provides that every registered person shall keep and maintain, at his principal place of business, as mentioned in the certificate of registration, a true and correct account of:
- Production or manufacture of goods
- Inward and outward supply of goods or services or both
- Stock of goods
- Input tax credit availed
- Output tax payable and paid
Some other documents and records also require maintaining apart from above-mentioned records, such as:
- Records related to imported and exported goods and services
- Records related to supplies attracting payment of tax under reverse charge mechanism
- Records related to goods received, supplied, lost, stolen, destroyed, given as gift or free samples, wastage, scrap etc.
- Advance received or paid and adjustment thereto
- Records related to Input Tax Credit (ITC), Tax payable, opening balance and closing balance of credit etc.
Accounting under Companies Law
Section 128 of Companies Act, 2013 provides that every company which is registered under Companies Act, 2013 or any previous companies act have to maintain its books of accounts and financial statements every year and maintain at its registered office.
Accounting under Partnership Law
Section 9 of Partnership Act, 1932 deals with the General Duties of the Partners. It is the duty of every partner to render true accounts and full information of all things affecting the firm to any partner, his heir or legal representative.
Accounting under Limited Liability Partnership (LLP) Law
Section 34 of Limited Liability Partnership Act, 2008 deals with maintenance of accounts and other records. As per the provisions of the section, every LLP, registered under LLP Act, shall maintain such proper books of account as may be prescribed relating to its affairs for each year of its existence.
Information, Data and Documents required for General Accounting.
For doing the work of general accounting of an entity, following information, data and documents required:
- Sales invoices (goods and services)
- Purchase invoices goods and services)
- Sale invoices (assets)
- Purchase invoices (assets)
- Bank statement
- Cash receipt and cash payment records
- Expenses records like rent, electricity, salary, wages, conveyance, stationary, business promotions, advertisement etc.
- Account adjustments details
How myaccountants.in can help you to complete your General Accounting?
myaccountants.in has knowledgeable and experienced team members to guide you and resolve your queries related to everything about General Accounting. You can follow the steps given below to get done your General Accounting through us.
Step 1. Book your service through make payment for selected service and you can ask queries related to service in case of any doubt.
Step 2. After receipt your payment, our team member will contact you to understand your requirements related to general accounting and guide you to send the required documents and information to get your accounting done and he will tell you about how much time it will take to get your accounting done.
Step 3. Our team will start the process of recording of accounting entries in accounting software and adjustment entries which are relevant to enter.
Step 4. After completion of all accounting work our team member will send you the account data on your email ID.
General Questions and Doubts related to General Accounting.
Q 1. To whom it is mandatory to maintain accounting?
Ans. Maintaining accounting records is voluntary but in some laws like income tax las, GST las, companies’ law etc. it is mandatory to maintain accounting.
Q 2. Which information can you get through accounting?
Ans. Through accounting you can know the amount of profit you earned in a particular period, apart from that you can measure the growth of your business.
Q 3. What should be the period of accounting?
Ans. Generally the accounting done on annual basis i.e. from the month of April to March of the next year, but it is depends on the business person to decide to get its accounting done on either monthly basis, quarterly basis, half annual basis or yearly basis.