Bookkeeping is an activity related to recording of the financial transactions of a business in a methodical manner so that all information is readily available when needed. A bookkeeper is responsible for keeping all data & files in systematic way. Bookkeeping and accounting are depended on each other as accounting get required information from accounting records and for making them useful for planning, control and decision making.
The work of bookkeeper is clerical in nature and can be accomplished by the use of computers & different software. It includes maintenance of both physical and soft files in a systematic manner. The work of a bookkeeper may be allotted departmental wise. Like a particular bookkeeper may be asked to keep the books of inventory/stores only. Then he will have to keep record of all input, output & document related to inventory only.
Accounting is broad function as related to bookkeeping. Bookkeeping, more or less, is a part of accounting as it assists in getting useful information at right time.
The scope of bookkeeping is limited and only concerned with recording, classifying and summarizing of business transactions. The main objectives of bookkeeping are:
- Systematic filing of all accounting records
- Readily availability of information
- Assist other functions of business by providing right information at right time
- Preservation and conservation of documents for long time.
Techniques used for bookkeeping
There are various software used for bookkeeping in computers. For physical file unique numbering system is used and files are saved year wise. The general approach used for bookkeeping is:
- Divide the files according to their Department and then to their functions. Like accounting files are separated from marketing and then purchase file & Sales files are separated.
- Then again files are subdivided, if possible like customer wise etc.
- Each main file is given unique number. Like Purchase file are given No. FY1415/PUR
- Then the files under main file are given number in alphabetic order Like No. FY1415/PUR/A
- Then this series files are again divided in numerical numbers like No. FY1415/PUR/A/1
- All this list are maintained in computer (in excel file)
- Then Labels with file names are printed and passed in the files.
- Then Rack No. is given for the boxes, where the files are kept.
The methodology may be changed person to person, but the objective should be achieved.
Hope you have understood the meaning of bookkeeping. Please ask query by commenting.
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