Keeping the books is a common phrase used in finance. Accountant used to record all financial transaction manually on a ledger through double-entry accounting. As technology advances, all this work is now done using software and computers.
What Exactly is General ledger?
This is a master accounting record offering comprehensive accounting details of a business or a company. As a business owner, general ledger allows you to have a clear overview of your business assets, revenues, liabilities, expenses, profit and losses.
It becomes easier to make financial decisions with these key details highlighted in a general ledger.
Reasons Why Your Business Needs a General Ledger
For accurate financial records, a general ledger is an important part of your business. The following are additional reasons why you need a general ledger in your business.
A general ledger contains up-to-date and accurate financial details about your company or business.
It simplifies the tax filing process because all the transactions are in one place; both expenses and income transactions.
It helps in balancing your books through the creation of trial balance.
It helps reduce unnecessary spending in your business because the income and expenditure records will be clear.
As a business owner, it will be easier for you to spot any unusual transactions in your business financial operations.
A general ledger makes it easy for you to compile various financial reports to help determine business profitability, as well as it’s general financial health.
A general ledger acts as a detector for any potential or already executed fraud in your business. Stopping fraud is also easier with a general ledger.
A general ledger is a master record for all your financial transactions of your business. Most people find it very difficult to come into terms with a general ledger and using it in their businesses. At first, it can be a daunting task but with time, you will get used to it and enjoy the above benefits.
It can be scary to accurately and effectively manage your business finances by yourself. The good news is that you do not have to do all that work alone. You can hire professional bookkeepers to help you out.
Are you looking for a helping hand in your business finances such as bookkeeping and auditing? Shoebox Books are specialists in providing various financial services, like bookkeeping, for businesses. Find your nearest bookkeeper from Shoebox Books company for more information.
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