The starting point is the Accounting Act, which is binding on non-governmental organizations. Associations and foundations must keep accounts, regardless of whether they operate with large amounts of money or live only from membership fees – Accounting types.
Accounting records conducted by units include, inter alia, accounting principles (accounting policy), periodic inventories, collecting and storing accounting evidence, preparing financial statements and subjecting them to audit in specific cases.
Accounting is also a component of accounting, i.e. keeping books of accounts, based on accounting documents, in chronological and systematic order. The actual purpose of keeping the books of accounts is the registration of financial events in compliance with the applicable regulations, the effect of which is a clear picture of the organization’s activities and finances.
In other words, everything you do must be reflected in your books of account.
Accounting program
Accounting is not only about filling in the boxes, collecting and rewriting amounts from bills and invoices. i.e. simple registration of financial events. The final financial result of the organization, i.e. the financial indicator of its activity, depends on what the financial rules are adopted in a given organization, i.e. how the chart of accounts is arranged, how the eligible programming and administrative expenses are.
On the other hand, a transparent, consistent, and reliable method of keeping financial books is one of the best recommendations of a given organization. A refined chart of accounts and accounting system makes it very easy to settle the received grants. It allows you to quickly generate the necessary information. For example, the costs of a given program, administrative costs. It helps in assessing the profitability of the entire organization and improves its work.
Types Of Accounting Records
Economic activity can be carried out in various forms, which are appropriate for the appropriate types of accounting records and methods of taxation.
Due to the type of accounting records, we can talk about:
- Simplified Accounting (Lump-sum income tax and Tax Book of Income and Expenses)
- Full accounting, i.e. accounting books
Who Is Required To Keep Full Accounting?
- physical people,
- civil partnerships of natural persons,
- general partnerships of natural persons,
- partner companies.
This obligation arises when the above-mentioned entities achieve net revenues of at least EUR 2,000,000 in the previous financial year.
In addition, regardless of the amount of turnover achieved, this obligation applies to many other entities, including commercial companies, civil partnerships, branches of representative offices of foreign entrepreneurs, organizational units operating on the basis of banking law, communes, points, voivodships, and their associations.
It is also worth noting that while some entities have a statutory obligation to keep full accounting. Although they do not have to, may choose this form of settlement.
Advantages
Despite the fact that full accounting is a very complicated and formalized method of accounting. There are a lot of benefits to the accounting method.
Full accounting – The undoubted advantages of keeping accounting books are:
- getting accurate information on all money flows and each transaction,
- obtaining a full picture of the company’s financial condition due to the accurate valuation of assets,
- data resulting from the balance sheet and income statement. It allows us to calculate the number of cash flows, cash flow. This shows exactly how much money we actually have at our disposal at a given moment,
- the ability to monitor the changes taking place on the basis of accurate property recording,
- obtaining indicators helpful in taking actions aimed at improving the functioning and development of specific segments of the enterprise.