Bookkeeping, Monthly Closing vs. Year-end Closing, is there Really No difference?

Is a company’s bookkeeping only for the purpose of tax reporting? Actually, the accountant’s bookkeeping is a critical oversight of the company’s operations. Thinking that yearly bookkeeping can save a small amount but may result in a big loss at any time!

Case studies:

Boss Chan, who runs a weight loss product business, has always entrusted an accounting firm to do monthly bookkeeping. Business has always been good, with stable income and expenses, and a “gross profit”. Suddenly, a “gross loss” appeared, which means every sales you made are losing money. The accountant in charge of the numbers noticed something was wrong and immediately notified Boss Chan to come to the company to investigate. You can’t make an omelette without breaking eggs. After reviewing the return slips and CCTV footage, it was discovered that someone was playing dumb. Manager Sarah, who had been with the company for half a year, had repeatedly ordered Japanese weight loss cream in the name of the company, but the goods were not stored in the warehouse when they arrived at the company. Instead, they were taken away by a friend in a truck, and the purchase were taken for her personal gain. With conclusive evidence, Sarah was confronted and revealed that she had sold the goods for profit on her own IG Shop. Trust was broken, of course, and there was anger and disappointment, but at least the wrong doing is discovered in the early stage and the loss was stopped in time.

Assuming that Boss Chan’s company adopts yearly bookkeeping, it is feared that Sarah would have cumulatively the fake purchase and has already “walked away” with the goods by the end of the year. With the boss busy with everything, there are times when things can slip through the cracks, so it is better to have a third-party accountant with no conflicts of interest do the monthly bookkeeping. Employees should be self-aware, and the accounts should be clear and provide peace of mind.

WhatsApp & Wechat: (852) 5236 2580

Website: http://www.maxi-solution.com/

WordPress: https://maxisolution.wordpress.com

# Bookkeeping # Monthly Closing # Year-end Closing #gross profit #gross loss #purchase invoice #CCTV #trust #stop loss #busy with everything #clear account #peace of mind #CPA #tax #tax filing #tax #accounting #Maxi #limited company #unlimited company