14 Advantages of Accounting Services.
Posted by Lakshmiaavana on May 6th, 2020
The objective of maintaining a books of accounts is to obtain more information about the financial standings of the business.
- Maintenance of permanent Business records
Basically business will have a large number of transactions. It helps in recording all the financial transactions related to that respective financial year.
- An Order and Systematic
Accounting is maintaining a systematic way of presenting business transactions in books of accounts. It is a complete process of representation of business transactions. Accounting helps keep a record and analysis of each and every business transaction.
- Decision making
The primary function of management is decision making. Accounting helps the management to make better decisions with increase in sales, respect to selling price (SP), deduction of cost etc.
- Business Valuation
Accounting helps in attaining the correct business valuation. The accounting services also help to depict in the balance sheet and this will be used to determine the purchase price.
- Helps in Raising loans
Business owners take loans in order to expand their business. Financial institutions provide loans on the basis of the profitability of the business. This can be measured by having a look at the accounts of the company.
- Evidence in court
Accounting helps to maintainall business transactions and are recorded in the books; and the records can be used as evidence in the court of law.
- Complying with law
When you set up a business, you will have to deal with various government bodies like the GST, income tax etc. Accounting helps in the filing of various returns with these government bodies.
- Preparation of Financial statements
If there is a proper recording of transactions maintained, Financial statements like Profit and loss account, Balance Sheet, Trading etc. can be prepared easily.
- Comparison of Results
At the end of the financial year, it helps in analyzing the financial results of the entity by having the year to year comparison.
It helps in securingAudit certificates issued by the auditor on the accounts, which proves that there are no irregularities in the company business.
- Effective management
Accounting provides feedback to the management about the financial status of the organization. This helps the management to make better business decisions and also helps in controlling different activities of the business.
- Cost control
It helps in efficient cost controlling by identifying and reducing business expenses. It also increases profits that helps in the budgeting process.
- Inter and Intra comparison Accounts
Intercomparison accounts is nothing butcomparison of accounts made between two different companies for the same period. The comparison made between two different periods for the same company is called intra comparison.
- Prevention of Errors, Frauds, and forgery
Accounting also helps in taking the timely steps for prevention and detection of fraud and errors.
Accounting helps in the overall growth of the business and also keeps the track of the financial transactions of the business. Accounting is the best way to systematically analyze the goals, growth, and shortcomings of business & LLP Registration India.Also See: Accounting Helps, Accounting Services, Business Transactions, Make Better, Helps, Financial, Business
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