Tuesday, August 5, 2008

The Different Types of Bookkeeping Systems

Outsourcing your Bookkeeping Services needs to India will enable you to get access to high quality bookkeeping technology at a very nominal price. The bookkeeping services offered by Indian companies offer the latest in accounting and employ trained professionals who specialize in different types of bookkeeping such as:

  • Single entry bookkeeping
  • Double entry bookkeeping
  • Online bookkeeping
Single Entry Bookkeeping System

The single entry bookkeeping system is the most simple and uncomplicated system of accounting since all the transactions is entered into a single column. The system is very similar to the way a checkbook register is maintained since the columns are usually for date, description and amount.

Advantages

  • Best used for small businesses
  • More Columns can be additionally added for different types of revenue and expenses
Disadvantages

  • Detailed financial information cannot be included in the spreadsheet
  • Exact financial position cannot be calculated
  • Mistakes and errors can be identified only through bank statement reconciliation
  • There is no link between the balance sheet and income
  • Liability and asset accounts, such as inventory, accounts receivable and accounts payable, cannot be tracked
  • Individual values are left out since only the difference between the expenses and revenues are calculated

Double Entry Bookkeeping System

The double entry bookkeeping system serves as a boon for large businesses that have lots of assets, thousands of transactions and various external suppliers of capital. In this system, two entries are made for each transaction, one in a debit account and another in a credit account. The columns are categorized as date, account, debit and credit. Therefore, for each debit entry, an equal and opposite credit entry is duly entered. Thus when the accounts are totaled, the sum of all debits must be equal to the sum of all credits.

Advantages
  • Mistakes and errors can be easily detected
  • Financial statements can be prepared directly from the accounts
  • Statements of profit and loss can be accurately calculated
  • Assets and liabilities can be included
  • Extremely appropriate for large organizations
Online Bookkeeping

The online bookkeeping system provides the customer with the option of storing their business documents, source documents and data in a web based application. This is done so as to enable the offshore provider’s bookkeepers to remotely access these documents and update the accounts as and when is needed. This is accomplished through a software based program, namely, SQL Ledger and QuickBooks.

Advantages
  • Accessing your accounts is easy and can be done anywhere and anyplace
  • Online bookkeeping services come with high standards of security
  • Accounts can be updated as often as required
  • Up to 50% of cost saving as compared to your present bookkeeper
  • Huge savings on time, effort and resources
  • Latest software and infrastructure is used in online bookkeeping

Whatever may be your choice of bookkeeping, outsourcing your bookkeeping services to India will ensure that you receive professional services at the most cost effective price.


3 comments:

SBL said...

Thanks...From your post I came to know the different types of Bookkeeping services. It is very helpful...
Regards,
SBL

Financial Advisor said...

Thanks SBL

i am glad that you liked my post and it was a source of information for you.

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Outsourcing Jobs Online said...

Good Work. Keep it up..