Bookkeeping Definition

Bookkeeping involves the systematic recording of the financial transactions and the maintenance of the correct & up-to-date financial records of the organization by an accountant clerk. Organization can be a business firm, charitable institute or even an association of sports. Effective management of the Bookkeeping makes the business owners acutely aware of the losses and the profits. To be precise, bookkeeping brings the result of the economic activities to the surface. It is also referred as: Bookkeeping, Book-keeping and Book keeping.

Many big organizations embrace accounting software in order to ease the complexity involved in the tax regulations and for making the calculations fast, whereas small firms engage bookkeeper for the purpose of writing the “Daybooks” that involves the details of purchase, sales, receipts and payments. Bookkeeper has to make sure that every financial information or data in relation to a company, such as: Balance sheet and Price-earning ratio is registered properly.

The two often used methods of Bookkeeping are: Single entry bookkeeping system and double entry bookkeeping system. Single entry bookkeeping denotes that all the transactions are to be entered only once in the account system. It keeps the record as regard with the flow of the income & expenses. This system is quite useful for the persons who have just commenced on the region of a business.

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