Journal Entries are recorded on a double entry system ie debit and credit concept. In order to record a journal entry the following steps need to be followed.
Debenture holder are those who provides long term loan at specific interest rate in term of cash and creditor provides only short term credit in term of cash for purchasing of goods.
ERS is a business process between trading partners that conduct commerce without invoices. In an ERS traction the supplier ships goods based upon an Advance Shipping Notice (ASN) and the purchaser upon receipt confirms the existence of a corresponding purchase order or contract verifies the identity and quantity of the goods and then pays the supplier.
Accounts Receivable department is very important department of the company. The responsbilities of the department is approval of credit limit to the customer study the past history of customer credit sending invoices to the customer updation of the customer credit data factoring contacts with the factoring agents follow up of customers motivating the customers to pay the dues intime and communicating the information to the management.
Credit sales data estimation of credit sales for the future period request for funds to finance department whenever they required follow up of customers receivables management.
Assets are things which is provide service for long duration it may 3 years 4 years or for long period of time.
These items capitalize in our account books and charge depreciation in every year according to these rate it may 20 10 100.
It is an expenditure the benefit of which will be realised over a period and not during the current period.Ex-Heavy Advertisement expenditure incurred by the company for promoting the product.The benefits of this huge expenditure will be realised over the period and not in the same period when it is incurred.
It is money receivable from sundry debtors for sales made or services rendered.
After 90 days of the due date.
Flow of Accounts receivable should be in proportion to Accounts payable i.e. in terms of ration 2:1
Intercompany tractions are those tractions that takes place between two or more entities of the same group of company. So the receivable of one entity would the payable of another entity. All intercompany tractions are eliminated befor preparing the final Balance sheet of the group company.
Accountants... in big organization there will be a department to maintain AR department.
A powerful tool to import and validate traction data from other financial systems and create invoices debit memos credit memos and on-account credits.
BRS - Bank Reconciliation Statement
A bank reconciliation statement is a statement prepared by organizations to reconcile the balance of cash at bank in a company's own records with the bank statement on a particular date.
The differences may arise because of the following reasons:
So, the statement shows the reasons as what are the reasons for difference in balance.
Money owed by a business enterprise for merchandise bought on open account. It is also called "A/R" or just "Receivables". Accounts Receivable are the amounts owed to a company by its customers and/or employees.
Derivative instrument is an asset which derives ie, takes its origin from another asset.
The simplest form of derivative is a forward contract, "It is an agreement to buy or sell an asset at a certain future time for a certain price"Other forms of of derivatives include futures,options and swaps, etc.
Time periods you define to age your debit items. Aging buckets are used in the Aging reports to see both current and outstanding debit items. For example you can define an aging bucket that includes all debit items that are 1 to 30 days past due.
Normal table used for this Report is < 30 days 30-60 days 60-90 days 90-180 days and >180 days
You should have recorded in your cash books all amounts you ve actually received and payments you ve actually made. However the cash books may be incomplete as your bank may have put extra tractions through your account such as:
Doing a regular bank reconciliation will allow you to:
By regularly doing a bank reconciliation (say monthly) you can be more confident that your records contain all the information you need to prepare your income tax return and activity statements.
A Customer Master Record is a permanent record that contains key information about a business partner or a material. This information must be entered into the system before any tractions can take place involving the business partner [customer] or a material.
Entering all the information about a customer or a material into the system b efore making tractions insures that subsequent tractions or inquiries will have consistent data and reports and analyses can be done in an orderly way.
Master Records can be edited or changed when necessary. Changing master records is frequently called "Maintaining" in SAP
Review balances and reconcile the AR tractions i.e
As sales occurs every customer is not able to pay the bills that's where A/R are occurs the goal of A/R is to maintain summarize & record all the tractions related to unpaid a/c or future collections or A/R.
Reconciliation statement is formerly known as a tool which is used to reconcile the bank passbook and our passbook.
Investment banking is a is a instrument which is used by the financial organization to take a better investment decision like issuing IPO stocks bond etc.
Accounts Receivables help small businesses by providing short-term liquidity. Also continued sales on credit provide the much needed continuity for small businesses.
Debtors are the main role of the business. he is the entire back bone of the business. The goodwill of the concern is in the hands of debtors because he is the person who takes our product or raw material to the customer or manufacture. so he is takes the main role in the business in finance and business development.
Finance:It is the branch of economics that studies the management of money and other assets.In simpler terms it can be defined as the commercial activity of providing funds and capital.It addresses questions like --what funds are required by the org? How they can be raised? How they have to be allocated etc
Accounts: It is the occupation of maintining and auditing records and preparing financial reports for a business. Accounts provides quantitative information about finances. It addresses issues like what amount of funds have been allocated to various activities how the book-keeping is being done etc
Both functions are distinct but complimentary to each other. Finance and accounts are highly specilized and distinct areas and hence most organizations have seperate sections of finance and accounts.
As the Accounts Receivable Supervisor, you will:
Its depends on the credit period of the company i.e. A company credit period 30 days 85 of the debtors collection should be recovered with in credit period. we can say the Effective collection.
Selling the rights to the amounts owing by debtors to a finance company for an agreed amount (which is less than the figure at which they are recorded in the accounting books because the finance company needs to be paid for providing the service).
The next step would be adjusting receipt from customer against the customer outstanding with sale and to clear the customer account.
One of the basic convention in accounting is separate legal entity.It me the business is different from those who manage it.When i contribute capital in to my business,it is liability to my business to repay it to me.