Introduction to Accounting System
Although
accounting as we know it has existed for only
about 150 years, financial record keeping can be
traced back more than 6,000 years. There has
always been a need to be able to express
someone's wealth to others to provide some kind
of a net worth statement. Sophisticated record
keeping developed only after two concepts carne
into common usage: the invention of coinage and
the development of the Arabic numbering system.
You will learn the following lesson in this
session:
Every
business generates mountains of paperwork, also
called source documents. Most of these provide
critical backup for the entries that will be made in
the accounting system. It's important right from the
beginning that you set up a system to track, record,
and store these documents for internal management
and external taxation purposes.
Time
and time again, in accounting practice some
small businesses that are literally buried in
paperwork. They know enough to hang on to the paper,
but do not know how to control it. Every large
company has documented systems for filing and
recording source documents (i.e., bills, receipts,
invoices, and bank statements), and if you want to
succeed in business, you should too.
Important Accounting Concepts
Before
you jump into setting up and maintaining a
bookkeeping system, there are several important
things you must keep in mind. These are
fundamental concepts that will help to guide you
through your reporting and control process, and
also help you to troubleshoot problems as they
arise.
The Role of the External Accountant
This
session looks at how to choose an accountant, what
your accountant does, and how to know when you have
outgrown your accountant.
In most major jurisdictions, there is no legal
requirement to retain an accountant. You are
allowed to handle all the tasks inherent in
running a business, including bookkeeping, tax
preparation, tax planning, financial statement
preparation, and forecasting. However, there are
many situations in which an accountant can help
you navigate the murky waters of business
management.
Budgeting: Planning for the Future
In this session, you will
learn
Foreign Currency Overview
Many
small businesses have to deal with foreign
currencies at some point. You may purchase goods
from a foreign supplier or sell to a foreign
purchaser. You may go on a business trip abroad and
have expenses to document. In
this session, you will learn
Foreign
currency is an area that is often handled poorly by
small-business bookkeepers. This session will touch
on the major issues and will show you how to account
for the most common types of foreign currency
transactions.
