Core service
Accounting & Bookkeeping
Books of account are not paperwork for the auditor. They are the record every other obligation is computed from — the return, the GST reconciliation, the bank proposal, the valuation — and each of those is only as good as the ledger underneath it.
Every business of any size is required to keep books, and more than one law says so. The Companies Act prescribes them for companies, the Income-tax Act for those above prescribed limits, and the GST law requires its own records of supplies, credit and stock. The obligations overlap but they are not identical, and a set of books kept only to satisfy one of them tends to fall short of the others.
The failures that cost money are ordinary ones. Bank accounts unreconciled for months, so a missing receipt is discovered a year later. Debtor and creditor balances carried forward without confirmation until nobody knows which are recoverable. Cash treated loosely. Stock never counted. GST credit taken in the books that the returns never claimed, or claimed in the returns and never recorded. None of these are difficult to prevent; all of them are expensive to unpick afterwards.
The work here is the ordinary discipline of keeping a ledger that closes each month, reconciles to the bank and to the tax filings, and produces a set of financial statements the proprietor can rely on before the auditor sees them.
Books of account
- Setting up or restructuring the chart of accounts
- Recording of sales, purchases, expenses, receipts and payments
- Fixed asset register, and computation of depreciation
- Inventory records, and reconciliation to physical stock
- Debtor and creditor ledgers, ageing and confirmation of balances
- Cash and bank books, and journal entries for accruals and provisions
- Bringing books that are behind up to date
- Migration to accounting software, or between packages
Reconciliation and monthly close
- Bank reconciliation, on every account, every month
- Reconciliation of the books to the GST returns filed
- Reconciliation of tax deducted to the credit statement
- Inter-branch, inter-unit and related party balances
- Reconciliation of loan accounts to lender statements
- A defined monthly closing sequence, with a cut-off that is respected
- Review of the trial balance before it is relied on
Financial statements and reporting
- Monthly and quarterly financial statements
- Annual financial statements in the format applicable to the entity
- Preparation under the applicable accounting standards framework
- Notes, schedules and disclosures forming part of the accounts
- Working papers and schedules prepared for the auditor
- Statements required by lenders under existing facilities
- Support during statutory, tax and internal audit
When this applies
Situations this covers
The books are months behind
Filing deadlines do not wait for the ledger. Bringing the books current is a defined piece of work, and it is worth doing before a due date forces an estimate.
Nobody has reconciled the bank in a year
Unreconciled accounts hide both errors and omissions. Reconciliation is where most bookkeeping problems are first visible, which is why it is monthly rather than annual.
The accounts and the GST returns do not agree
Turnover in the books and turnover in the returns should reconcile, and where they do not, the difference will be raised eventually — in the annual return, or in scrutiny.
Your bookkeeper has left
A handover mid-year needs the position established independently: what has been recorded, what has not, and what the balances actually represent.
The auditor keeps asking for the same schedules
Audit friction is usually a bookkeeping symptom. Schedules prepared as part of the monthly close rather than at year end shorten the audit and reduce the questions.
You are moving to accounting software
Opening balances, masters and the chart of accounts have to be set up correctly at migration, because errors introduced at that point persist through every subsequent year.
Method
How the work runs
- 01
Establish the current position
How far the books are written up, what has been filed on their basis, and where the last audited or finalised figures stand.
- 02
Fix the structure before the entries
Chart of accounts, masters and the treatment of recurring transactions are settled first, so that the same item is recorded the same way each time.
- 03
Bring the ledger current
Arrears are written up in order, with the reconciliations performed as the work proceeds rather than left to the end of it.
- 04
Close each month, and hold the cut-off
A closing sequence is set — accruals, provisions, reconciliations, review of the trial balance — and the period is closed rather than left open indefinitely.
- 05
Report, and reconcile the reports
Financial statements are produced for the period and tied back to the ledger, the GST returns and the tax credit statement, so the same figures appear everywhere.
- 06
Carry it through the year end
Year-end schedules, audit working papers and the finalised accounts follow from books that have been closed monthly, rather than being reconstructed in one exercise.
Questions
Commonly asked
General information on procedure. It is not advice on any particular matter.
Do I have to keep formal books at all?
It depends on the entity and the level of turnover or income. Companies and LLPs must maintain books regardless. For individuals and firms the obligation arises once turnover, gross receipts or income cross the prescribed limits, and separately for specified professions. Registration under GST brings its own record-keeping requirements irrespective of size. In practice, a business that has to file returns is better served by proper books than by reconstructing figures each year, whatever the strict obligation is.
How is this different from what my accountant already does?
Often it is not, and where an existing arrangement is working there is no reason to change it. The difference this firm brings is that the books are kept with the tax and GST positions in view — the ledger reconciled to the returns each month, the schedules the auditor will want prepared as the year runs, and the balances confirmed rather than carried forward. It also means the same person answers when a notice arrives asking why a figure is what it is.
Our books are two years behind. Is that a problem?
It is a common one, and it is recoverable. The work is done in order, oldest period first, because each year opens from the last one. What matters is what has been filed in the meantime — where returns were filed on estimated figures that the completed books do not support, that difference has to be identified and dealt with deliberately rather than left to be found.
Which accounting software should we use?
The one your people can operate reliably. Most small and medium businesses in India are adequately served by the common packages, and the choice matters far less than the discipline around it. Where a change is genuinely warranted — usually because of volume, multiple locations or inventory — that is said plainly and any licence cost flagged before anything is committed.
Can you also do our GST and income tax filings?
Yes, and it is usually more efficient that way, because the filings are drawn from the books rather than reconciled to them afterwards. They can equally be kept separate if you prefer, in which case the books are handed over in a form your other advisers can work from directly.
What does it cost?
Professional fees depend on transaction volume, the number of bank accounts and registrations, whether arrears have to be cleared, and whether the engagement is monthly bookkeeping or periodic review. Scope and the basis of fees are agreed in writing before work begins. Fee rates are not published here.
Are the books current enough to be useful?
Books written up months after the event answer questions that have stopped mattering. Getting the cycle current is usually the cheapest improvement available to a small business.
Related services
- AuditStatutory audit, tax audit and internal audit conducted under the applicable Standards on Auditing.
- Income TaxTax planning, advisory and return filing for individuals, firms and companies.
- GSTRegistration, periodic returns, annual return and reconciliation, and ongoing GST compliance.
- MIS / EIS & Budgetary ControlDesign, implementation and maintenance of management and executive information systems, and of budgetary control frameworks.