Bookkeeping is the plan, complete, chronologically, and factually ordered the recording of all business transactions. However, accounting is also understood as the processing of work related to financial accounting. The principle applies to No booking without a receipt. Depending on the purpose of bookkeeping and what data basis is used, different types of bookkeeping have emerged. For example, there is financial and operational accounting, main and sub-accounting, central and branch accounting. Financial accounting is the most important part of business accounting alongside business accounting. It aims to document and inform.
Financial Elements of Accounting
In financial accounting. All business transactions are recorded by postings in accounts. The principles of orderly bookkeeping, GoB for short, should be observed. With double-entry bookkeeping. All changes in business assets are also documented on stock accounts. Proper bookkeeping shows the entrepreneur the economic situation of his company. At the end of the year. The balance sheet and the profit and loss account. Part of the annual financial statements. Are created from the accounting data.
If you have an accountant, full bookkeeping is more cost-effective. You can save money by sorting and completely handing over the accounting documents to the accountant or accountant. However, if he first has to sort the documents received and request further receipts, this will, of course, be charged as an additional expense. Audits by the tax office can also run much more smoothly and relaxed with orderly bookkeeping.
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Accounting: indispensable for your company
If you are self-employed, you should still record all expenses and income to provide information on this. In accordance with the law, every self-employed person is required to do so, regardless of the amount of their income or the size of the business. But despite the obligation, proper and thorough bookkeeping is essential for you as an entrepreneur to keep track of your finances and business. Good bookkeeping is also necessary for investment and cash flow planning.
Internal or external: choice for founders
Your books must always be up to date Under no circumstances should the documents be lost. Also, you should not lose sight of your accounting. Therefore, whether you want to keep your accounts yourself or entrust this activity to a professional. The following options are available for young entrepreneurs:
Do the bookkeeping yourself.
For financial reasons, start-ups, in particular, prefer to take care of the books themselves. This means an additional effort for you that should not be underestimated, even if the bookkeeping is not as extensive as in an established company. However, this solution often pays off from a cost perspective for your company. In addition, you keep track of the finances of the company. You can also build up your specialist knowledge in this way and do not have to rely on a specialist blindly. To make the complex work easier, you can use a software solution that allows you to keep your books quickly, easily, and efficiently. This offers you the great advantage that the data is exclusively yours, and you can access it at any time.
Outsource the accounting
As a start-up, you also can outsource the accounting department.
Hire a tax advisor
If you hire a tax consultant to keep your books, he can not only do all the bookkeeping for you. The tax consultant is also authorized to make the summary report of intra-Community deliveries. The advance sales tax returns. And the annual financial statements. The former is a tax exemption that is recorded in sales tax law. As a result, no sales tax has to be paid in the supplier’s country for cross-border deliveries within the EU. This is levied in the country of purchase. The supplying entrepreneur must point this out to his customer and document this fact in the bookkeeping. It is also your job to take care of the preparation of travel expense reports, hospitality receipts, and personal receipts.
If you have decided to hire a tax consultant to do your bookkeeping, you only have to collect and sort the documents. The tax consultant will then check the completeness of your documents, send you regular evaluations of developments and figures, and inform you in good time about submission dates.
Hire an accounting office
According to Section 5 of the Tax Advisory Act (StBerG), an accounting office may not advise its customers on tax matters. However, it is authorized to take over your bookkeeping. Your responsible accountant controls and documents all business transactions. The main difference between a tax consultant and an accounting office is that the latter is not qualified to do the annual accounts – i.e., balance sheets, profit and loss accounts, and income surplus accounts. If the accounting office does your annual financial statements, an auditor must also check them.
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