Bookkeeping is important for a business as it provides profit and Loss statement for a business which is needed for tax preparation. Bookkeeping is recording of income, expenses, assets (debits), and liabilities (credits) transactions in a business. All income and expenses are categorized using charts of accounts so that these can be used appropriately in tax preparation. Bookkeeping is an essential part of accounting as it not only helps in the reconciliation of bank statements but also helps in preparing financial statements such as Balance Sheet, Cash Flow Statements, and Profit and Loss statement on a monthly, quarterly or annual basis. These statements are necessary for presenting to the financial institutions or shareholders of a business organization. Bookkeeping can be done in a single-entry system as done in QuickBooks which is just recording of income and expenses or in a real bookkeeping system it is done on the double-entry system. A double-entry system helps to link all income and expenses to Assets and Liabilities.
Dr. Rastogi’s staff can help a client in the bookkeeping of business using bank statements. Our staff can make sure that all bank statements are reconciled, and all financial statements are prepared every month. The annual financial statements can be used in tax preparation, business savings, and financial planning. We use the state-of-the-art RPA (Robotic Process Automation) technology to read bank statements employing a Bot. The bot is a computer program that performs certain repetitive steps in a process using AI. Bot prepares all double-entry files for the Accounting program that RTFS LLC uses for Bookkeeping. Bot also goes into the accounting program and ads the created files and makes sure that all entries are appropriately added in the accounting program and financial statements are prepared accurately. Once our client let us know about the categories of the chart of accounts for various transactions, Bot will put these entries appropriately in the accounting program. Finally, our staff with the help of Dr. Rastogi and the client will make sure that all expenses and income entries in bookkeeping are categorized correctly.
If we look at the bookkeeping it tells us the financial health of a business over a certain period. Bookkeeping gives all information for the financial part of the accounting. It is important to know how a business is doing financially. Is the cash flow based on financing or due to the organic growth of the business? What expenses are increasing and are the expenses in line with the industry standards? In any business payroll is the biggest expense. Bookkeeping can help in letting a client know how employees and contractors’ expenses are increasing or decreasing? It will help the client managing the business intelligently and efficiently. The client will be controlling the business and not the other way that business controls the client and the client’s management team. One of the important aspects of bookkeeping is helping clients in the estimation of quarterly income taxes to filed with the IRS. This will help clients in avoiding penalties for underreporting the estimated income taxes.
