Financial Transactions and Reporting

Financial transactions and reporting is the process read this of monitoring and studying the flow of money through your company. This can include transactions that occur internally, such as purchases, payroll and expense reports; as well as externally, like rental and sales of assets; or credit-related transactions (e.g., loans and revolving credit, as well as cash advances). It is important to analyze financial transactions to ensure that your accounting records remain accurate and reliable. This requires clear definitions and processes and a regular and regular update.

Internal transactions are those that occur within a business that are part of a company, for example, purchases, sales and rental of office space. These transactions are also referred as non-cash, since they do not require the exchange of products or services in exchange for cash. These transactions may include social responsibility and donations and other expenses such as PCard and travel charges.

Non-cash and cash transactions are recorded in the financial system of record, which can vary from a basic accounting software program to a sophisticated Enterprise Resource Planning (ERP) system. A sound financial statement relies on policies and procedures that ensure that only those transactions are recorded in the system that can be verified with objective evidence, such as sources of documentation such as purchase receipts, sales orders invoices, cancelled check, bank statements, promissory notes and appraisal reports.

To verify the authenticity of a transaction, you must first identify the accounts that are involved and then determine the account which the transaction will be debited or credit. For instance, suppose your business earns $5,000 revenues from consulting services. To record the sale, you must identify the income account and the accounts receivables account. You must verify that both are growing and follow the rules for debiting and crediting. To complete the procedure, you should then record the transaction in your journal entry.