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Accounting books are a record of all financial transactions that a business makes. They are used to track income, expenses, assets, and liabilities. Accounting books are important for several reasons, including:

  • They help to ensure that financial information is accurate and complete.
  • They provide a historical record of a business's financial performance.
  • They can be used to prepare financial statements, such as balance sheets and income statements. 
  • They can be used to file taxes.

There are following key aspects of maintaining accounting books are:

  • Identifying the transaction through an original source document and determining which accounts are affected and by how much
  • Making a voucher with details on date, amount, description, name and particulars of the party
  • Making entries in the books of accounts or accounting records like cash/bank book, ledger, etc.
  • Making entries in other memorandum records like fixed asset register, advance register, etc. if applicable
  • Following the key accounting policies and principles for recording transactions
  • Closing the books of accounts on a periodical basis and reconciling them with bank statements
  • Preparing key financial statements like income and expenditure statement, balance sheet, etc.
  • Following the prescribed formats for books of accounts and financial statements

 

Resource:

1. Training Module on  â€œFinancial Monitoring & Reporting, Ministry of Health and Family Welfare, Government of India

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