Bookkeeping
What is Bookkeeping?
Bookkeeping is the systematic recording, organizing, and tracking of a business’s financial transactions on a daily basis. It’s the foundation of accounting and financial reporting.
Types of Bookkeeping Systems
-
Single-Entry Bookkeeping
- One-sided entry (like a personal checkbook)
- Suitable for small businesses
-
Double-Entry Bookkeeping
- Every transaction affects two accounts (debit & credit)
- Standard system for businesses
Key Components of Bookkeeping
- Chart of Accounts (COA)
List of all accounts used (assets, liabilities, income, expenses) - Journals
First place transactions are recorded (date-wise) - Ledgers
Summarized and categorized record of all transactions - Trial Balance
A summary to check if total debits = total credits - Financial Statements
- Profit & Loss Statement
- Balance Sheet
- Cash Flow Statement
Common Bookkeeping Tasks
- Recording sales & purchase invoices
- Managing receipts & payments
- Bank reconciliation
- Payroll processing
- Tax computation
- Generating reports (monthly, quarterly, annual)
Essential Documents in Bookkeeping
- Purchase & sales invoices
- Expense receipts
- Bank statements
- Credit notes / debit notes
- Tax challans
- Salary slips
Benefits of Proper Bookkeeping
- Better financial control
- Easier tax filing
- Simplified audits
- Decision-making support
- Helps in loan and investment documentation
Bookkeeping Tools & Software
- Tally
- Zoho Books
- QuickBooks
- Busy Accounting
- Xero
Legal & Tax Importance
- Helps in GST, TDS, and Income Tax compliance
- Required for ROC filings for companies
- Base for filing ITR, annual financials, and more
Manual vs. Online Bookkeeping
| Manual Bookkeeping | Online Bookkeeping |
|---|---|
| Paper records | Cloud-based software |
| Time-consuming | Real-time updates |
| Prone to errors | Automated calculations |
| No backup | Auto-backup & secure |
Who Needs Bookkeeping Services?
- Companies (Pvt Ltd, LLP, OPC)
- Startups & MSMEs
- Traders, Manufacturers, Service Providers
- Freelancers & Professionals
How Lexclaws.com can help you
- Setting up your accounting system
- Monthly bookkeeping & reconciliation
- GST/TDS return preparation
- Payroll processing
- Year-end financials for tax or audit
