What is meant by record keeping? discuss the significance and principles of record keeping?
Answers
Many times accounting and record keeping are used interchangeably, but this is incorrect. Accounting has a much more broad definition than simply recording transactions in an accounting system. Accounting is used to identify events that need to be recorded, recording the transactions of these events, and communicating the effects of these transactions with people inside and outside of the company. As you can see, record keeping is only a small part of the broader definition of accounting.
significance of Good Record Keeping. Good record keeping is key for a successful business. Every person involved in business needs to keep records and the more organized the records the better the information you can retrieve from those records. ... Monitor the progress of your business.
Answer:
One of the main parts of accounting is recordkeeping or bookkeeping. Recordkeeping is the process of recording transactions and events in an accounting system. Since the principles of accounting rely on accurate and thorough records, record keeping is the foundation accounting.
Example:
An example of an accounting event would be the purchase of a company vehicle. The accounting or recordkeeping department would record the purchase of the vehicle as a debit to the vehicle asset account and a credit to cash or liability accounts in the general ledger. Computerized accounting systems can then use this data to generate asset and liability reports.Before computers and servers became widespread, accounting records were recorded on ledger paper by hand. Each account was manually transferred from the general ledger to T-accounts in order assembly reports and financial statements. Today technology has change accounting systems and recordkeeping procedures. Most of these accounting processes that were done manually in the past are now automated. The time savings and reliability of accounting systems also help create more accurate records.