certified accounting course in Ahmedabad Archives

Posted on July 5, 2021May 27, 2024 by admin-s20

Qualities Required To Be An Accountant

Introduction An accountant handles one of the most crucial roles in a business regardless…

Introduction

An accountant handles one of the most crucial roles in a business regardless of it being for a large corporation or a small business. They are the financial backbone of a business and handle monetary records, money transactions, and timely taxes.

There are different types of accountants. Government accountants work for government agencies’ monetary records. Public accountants are either self-employed who work audits, documentation, and tax for clients or they account for firms. Management accountants are employed by a single company and they account for internal financial records of that company only.

Who Is An accountant?

An accountant is a professional who is in charge of the protection and transliteration of technical records and survey of financial statement analysis. They work for firms or big and small companies.

An accountant’s day-to-task mostly depends on their educational background and the designation they hold. Have you ever wondered if there was an accounting centre near me? How wonderful would it be to start your journey towards your dream job!

Most people start their journey by getting themselves into a school followed by a Bachelor’s degree in the same BCom course.

But some firms may demand additional educational certifications after BCom. Some of the common accounting designations are Certified Internal Auditor (CIA), Certified Management Accountant (CMA), and Certified Public Accountant (CPA). So, for accounting training and placement, one should look for good cl.

What Does An Accountant Do?

Accountant paints a picture of a company’s stand in the global market by using numbers and financial statements. Some of the accountants’ everyday tasks include the following :

Preparation of profit and loss statements and monthly cost accounting reports.
Maintaining and processing monthly payments and stipends.
Completing audits and interacting with auditors.
Analyzing and accounting.
Evaluating and accounting budgets, outlay, payments, and bills.
Settling account discrepancies.
Maintaining computer software and manual filling systems.

Who Hires An Accountant?

Various businesses hire accountants to balance their taxes and audit the financial records. Organizations having complex financial systems and loaded transactions require accountants.

Some examples of such organizations are:

Universities And Schools
Schools and colleges have complex monetary systems and require professional accountants to manage their profits and expenditures. The accountants hired are supposed to make sure that the capital and funds are sufficient to meet the needs of the institution’s various departments and covers the college tuition expenses.
Hospitals
Hospitals and healthcare providers work with insurance agencies to help people with medical needs. The job will require working directly with insurance companies and make sure the organization doesn’t exceed its expenses.
Agencies of Government
This sector needs high-precision accounting and ensuring that the revenue and expenditure get properly recorded. Since the government agencies are so large, the job vacancies are a lot as well. The candidate will be responsible for recordings of various programs and initiatives under the compass of these agencies.
Entertainment and hospitality companies
These businesses perform thousands of transactions every day and experience a lot of revenue every day. They also need accountants to collect the receipts, records, and tax time rolls. They also involve in managing employee payrolls.

Strengths That An Accountant Should Have

Analytical Skills
“Good accountants can pull the analysis together, great accountants look at the output and judge whether it is reasonable, so as not to waste everyone’s time on an analysis that makes no sense when you take a step back and look at it from a common-sense standpoint.”- Bob Prather

Accounting is a meticulous task that demands attention and precision.

Organization
The work of an accountant includes client meetings, deadlines, and following proper guidelines. Each of these works demands a notable amount of documentation and keeping track of all the paperwork.

“The best way to stay on top of deadlines is by getting organized”- Logan Alec

Critical Thinking
Critical thinking is an invaluable skill in the accounting profession.
Accountants face a lot of fallacies, discrepancies, and imprecision in their daily work that needs to be detected and rectified.
These fallacies’ can have serious aftermath if not addressed in time. Hence, accountants need to think beforehand and think critically to face all potential risks and solve them in time.

Adaptability
As we know that change is the only constant, it holds for the accounting profession as well.
It constantly changes and evolves. Accountants should always be ready to readjust to technical advancements, workplace dynamics, and altering standards and protocols.

Interpersonal Communication
Accountants serve as data translators. Accountants work for clients and many of them may not be aware of complex monetary concepts. Thus accountants are required to spell out their work and transform the complex concepts into average peoples’ understanding.

Time Management
“Working on different projects and being able to manage deadlines is a trait that separates passable accountants from their top-shelf peers” – Kyle Bryant

Multitasking and proper management of all the work are the top skills an accountant should have to provide satisfactory results for their clients in time.

IT And Industry Knowledge
Accountants should understand how software accounting works and how it can be applied to make a change for progress.

Top Accounting Skills For Success

Innovation
The evolving business world demands an evolving accounting system along its side. Companies often look for candidates assuring to create a change for the better.

Enthusiasm
Enthusiasm is contagious and it brings positive energy to the team. It shows that the candidate is eager to learn his/her trade and believes what he/she is working towards.

Trade awareness
It is the knowledge of where the company stands in the global market, how it is affected by social, economic, and political issues and how to make progress and move ahead.

Integrity
Building trust and reputation get the job done halfway. Credibility opens the door for new opportunities.

Communication
Accounting systems are not understandable by the common people, this is where communication skills come in. An accountant should be well-versed with the task they are working on and the way they have to translate it for the common people to understand. They have to fill the gap between numbers and stories.

Understanding
Comprehending new statistics and data is crucial.

Initiative
Initiative proves that the candidate is an independent thinker and can work on his own. This welcomes more trust and better opportunities.

Conclusion

Accounting job includes transaction and producing of monetary reports.

Candidates have to develop problem-solving skills, decision-making, and critical thinking. So if you are someone who is considering venturing into the accounting field, be sure to develop these characters to be the perfect match for what’s expected to come your way in this field.

Posted on May 26, 2021May 27, 2024 by admin-s20

Accounting Concepts And Assumptions

Accounting is the process of recording financial transactions of a business. The accounting process…

Accounting is the process of recording financial transactions of a business.

The accounting process includes summarising, analysing, and reporting these transactions to oversight agencies, regulators, and tax collection entities.

Important Accounting Principles

Accounting Concepts refer to the basic assumptions, rules and principles which work as the basis of recording business transactions and preparing accounts.

The main objective of these concepts is to maintain uniformity and consistency in the accounting records. These concepts consisting of the very basis of accounting are as follows

Business/ Economic entity assumption: This concept assumes that for accounting purposes, the business enterprise and its owner are two separate entities. For example, when the owner invests money in the business, it is recorded as a liability of the business to the owner, similarly, when the owner takes away some business cash/goods for his personal use it is not treated as a business expense.

Thus the business entity concept states that any expenses incurred by the owner from the business for his personal needs will be considered as withdrawal and will be shown in the drawings. External stakeholders like; Government and investors use a company’s financial records to assess its performance. Hence the transactions must reflect the activities of the entity accurately

Money measurement concept: This concept assumes that all business transactions must be in terms of money, that is in the currency of a country. It is the reason why you have to complete your business bookkeeping for a foreign transaction in Home currency.

This concept helps in recording business transactions uniformly. While this concept guides the accountant on what to record and what not to record, here is a link to a certified account taxation course in Ahmedabad that is sure to guide all the CA aspirants or accounting professionals.

Going concern concept: It is also referred to as ‘the non-death principle’. This concept states that a business firm will continue to carry out its activities for an indefinite period. This concept helps in the preparation of financial statements also depreciation on a fixed asset is charged based on this concept. It helps the business judge it’s capacity to earn profits in future

Accounting period concept: As per the accounting period concept, all the transactions are recorded in the books of accounts for a specified period. Hence, goods purchased and sold during a period, rent, salaries etc paid for a period are accounted for and against that period only. It is because of this principle that your balance sheet always reports information as of a certain date and the profit and loss statement encompasses a specific date range. There are also some limitations to this concept like in case of inflation, there will be an overstatement in the net profit. In India accounting period is 1^st April to 31^st March for every year.

Accounting cost concept: This concept states that all the assets are recorded in the books of accounts at their purchase price. The effect of the cost concept is that if the business entity doesn’t pay for an asset, that item will not be shown in the books of accounts.

It limits the required amount of research and time to record or report financial information if the cost out weights the benefits. This basic accounting principle is important because it reminds the business owners not to confuse cost with value

Dual Aspect Concept: Dual Aspect is the foundation or basic principle of accounting. It provides the very basis of recording business transactions in the books of accounts. This concept assumes that every transaction has a dual effect i.e, it affects two accounts on their respective opposite sides.

Therefore, the transaction should be recorded in two places: e.g. a) giving of cash and b) Receiving of goods. Thus, the duality concept is commonly expressed in terms of the fundamental accounting equation

Assets = Liabilities + Capital

Realisation Concept: This concept states that the revenue from any business transaction should be included in the accounting records only when it is realised. The term realisation means the creation of a legal right to receive money.

For example: Selling goods is realisation, receiving orders is not. In short, the realisation occurs when the goods and services have been sold either for cash or credit. It also refers to the inflow of assets in the form of receivables. This concept helps in making the accounting information more objective. The rule also says that when risk and reward is transferred for goods or services from one person to another then the revenue should be recognised.

Accrual Concept: The meaning of accrual is something that becomes due, especially an amount of money that is yet to be paid or received at the end of the accounting period. It means that revenues are recognised when they are receivable.

It helps in knowing about the actual income and actual expenses during a particular period, which in turn helps in calculating the net profit of a business

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Matching concept: The matching concept states that the revenue and the expenses incurred to earn the revenues must belong to the same accounting period. It guides on how the expenses should be matched with revenue for determining the exact profit and loss for a particular period.

It is a very important concept for the investors/shareholders as it helps to know about the exact profit and loss of a business. This principle works with the revenue recognition principle ensuring all the revenues and expenses are recorded on the accrual basis

Principle of Conservatism: When there is more than one acceptable way to record a transaction, the principle of Conservatism instructs the accountant to record the expenses and liabilities as soon as possible. Using the principle the accountant will be more likely to anticipate losses in the reports

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Posted on March 8, 2021May 27, 2024 by admin-s20

Accounting For Reserves And Surplus

Just the way we categorize our expenditures at the end of every month, various…

Just the way we categorize our expenditures at the end of every month, various business organisations include Reserves and Surplus in their balance sheet keeping their future needs as an organisation in the picture. In simple words, they are the savings of big corporates which can be used as assets during a crisis.

What Do Reserves And Surplus Mean?
Reserves
A financial accounting Reserve is a part of the shareholder’s equity except for basic share capital. A Reserve is profits that have been appropriated for a particular purpose. In accounting terminology, reserve implies the amount set aside for future activities which include buying assets, paying for bonuses or even legal settlements.

Surplus
Surplus describes the amount of an asset or resource that exceeds the portion that is actively utilised. In the budgetary context, a Surplus occurs when income earned exceeds expenses paid.
Reserves and Surplus, as the name suggests, are the accumulated profits that a company has earned and retained over time. Retained profits are the profits that are left after repaying the shareholders. General Reserves are created out of profits and kept aside for the financial strengthening of the company in bad years.

Difference Between Reserves And Surplus
Reserves are the primary amounts that are earmarked by the organisation for specific purposes. Whereas Surplus is where all the profits of the company reside.

Types Of Reserves And Surplus
Depending on their purpose there are various types of Reserves used in a balance sheet.

Capital Reserve
A Capital Reserve is the type of Reserve that is created from capital profits. Capital Reserve is maintained to prepare the company for sudden hazards like inflation, business expansion and funds for new ventures.

Cash received by selling current assets
Excess on revaluation of liabilities and assets

are a few examples of Capital Reserves.

Capital Redemption Reserve (CRR)
Capital Redemption Reserve is created when the preference shares or the capital is redeemed. It is a statutory Reserve. When a company wishes to redeem shares a Capital Redemption Reserve account is created to benefit both the creditors and employees.

A Capital Redemption Reserve comes in handy for the company on a rainy day. Several litigations are attached to this reserve such that the company can open this reserve only under certain circumstances.

Security Premium Reserve
It is the additional amount charged on the face value of any share when the shares are issued, redeemed and forfeited. Security premium account is a part of the Shareholders Fund, it refers to the difference between market value and the face value of a share.

Debenture Redemption Reserve
A Debenture is a debt security that lets the investors borrow money at a fixed rate. A Debenture Redemption Reserve must be created to protect investors from the possibility of a company defaulting.

Debentures are not backed by any kind of asset, lien or collateral. Free Reserves are those Reserves upon which the company can freely draw, Debenture Redemption Fund is one such Reserve.

Revaluation Reserve
Organisations have the freedom to construct line items for assets on the balance sheet when they believe it is a necessity for correct accounting to be presented. Revaluation Reserves are not inherently normal, but they can be used when a business assumes that the value of their assets will fluctuate after a certain time frame.

Other Reserves: Specifying Nature And Purpose

Surplus
Surplus i.e balance in statement of profit and loss disclosing allocations and appropriation such as dividend, bonus, shares and transfer to/from Reserve etc.

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Why Are Reserves And Surplus Called Liabilities?
Aren’t Reserves supposed to be good? They are money set aside for future endeavours and hazards, How is being financially safe considered a liability? Isn’t having surplus money a boon?

Well here are the answers to all your queries,

Reserves are considered on the liabilities side of a balance sheet because they are sums of money that have been set aside to be paid out on a future date. To be more precise Reserves are considered a liability keeping the peasant scenarios in mind. Reserve is considered a liability keeping all the future requirements in mind.

Reserves also represent the obligations that the form has, which makes Reserves a liability item. Reserves can be future or potential obligations to various stakeholders or future use of funds to benefit various stakeholders.

For a better understanding, we can compare Reserves to a bank, though the bank is always expected to have money, yet it is considered a liability keeping in mind that money is not for the bank but to meet up with the financial needs of their account holders.

What Is Meant By A Negative Reserve?
Negative Reserves are considered as assets, for example, the money which is due to the policyholders i.e debtors. But these are assets which may be realised or forgetting that the policyholders may withdraw, leading to a policy lapse.

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