Incomplete Records

Accounts that don't follow the double entry

Benefits of a Bookkeeper

1. Produces up to date financial records

2. Can be used to improve the credit control systems

3. Improves Decision making

4. Improves Cash Flow / reduces bad debts

Disadvantages of a Bookkeeper

1. Costly

What is a bank statement?

It is the copy of the customers account in the bank's books of account

This is confusing but the debit and credit is opposite

Advantages of Bank Statements

1. Helps Obtain the correct bank balance

2. Find errors in the bank statement

3. Find errors in the bank account

4. Identify errors and frauds

5. Identify stale and dishonoured checks

6. Identify unpresented cheques

7. Identify uncredited lodgements

Advantages of InComplete Records

1. Enables the trial balance to be prepared

2. Enables financial Statements to be prepared

3. Improves arithmetical accuracy of record. Also reduces error

4. Reduces frauds by introducing reconcillations to check the balances by using trial balance and control accounts

5. It shows the balances of the trade recievables and payables so avoid overpayments

6. Improves decision making and can be used to measure performance easily

Disadvantages of Control accounts

1. Increased Cost & more time consuming

2. Requires a specialist team to be employed

Advantages of Preparing financial Statements

This is a general question and it includes benefits to different parties

1. Can be presented to bank for additional finance

2. Can be used to measure performance of previous years

3. To make Decisions

4. To make plans and targets

5. To identify areas where correction action is required

6. To calculate tax

Should a business have complete records?

The answer is always yes... but make sure to advise with both disadvantages and advantages