surendra (accountant) (28 Points)
16 June 2011Presently I am working in a private limited company as an accountant formed before 4 months ago.The question is from where I have to start with because they have not made accounting entries uptill now and I have to start initially from incorporation.
thanks.
Srikanth
(Auditor)
(31 Points)
Replied 20 September 2011
Dear Surendra
The accounts actually starts with from the day of when it got into the mind of a person who actually started it in the form of proprietor, partnership firm or company......he might have noted certain expenses in his way and you can got those details and record it in a software like tally to determine the financial implications and accounting procedures and policies according to our indian govt laws like income tax, companies act, local vat act, service tax act ,etc....
So it is better to begin with a guidance from a chartered accountant before start itself .....
Ateeq
(CA - Final)
(218 Points)
Replied 20 September 2011
Dear Surendra,
The first entry in any or every type of entity with respect to accounts will be related to capital and the accounts should be started from the first day of expenditure. Say for example : -
Flat or Office or any sort of establishment purchased or taken on rent on 1-Jan-2011 and company or firm is registered or started from 1-Apr-2011. Then it will be the at the discretion of the owners of the company or entity. If it is a company as you said private limited company. Books of accounts will be started from the date of incorporation and the first entry should be for Capital introduced into the business in whatever form and subsequent entries will be for initial expenses and receipts than for sales and purchases and so on.
Further, if you are not prefering manual book accounting as it is obsolete than you have to go for a concept called "Book Building".
In "Book Building", you have to create your books of accounts in the following manner: -
1. Create Groups.
2. Create Ledgers.
3. Journal entries and so on.....
So above are the basic and fundamental issues with respect to the accounting.
Write me for any further queries.
Master GSTR-9 and 9C with India's First Unique Live Course with Live practical training
CAclubindia
