The accounting process for a company can be segregated into two parts:
- The records of the company are well maintained
- For filing of taxes, the amount needs to be calculated. In the absence of bookkeeping and entries, calculation of taxes is prone to errors.
- For Private Limited Companies and other entities which meet the revenue criteria, auditing is mandatory. Bookkeeping is the process of creation of the books which are audited by the auditor. It is advisable to maintain monthly books of accounts which can be audited at the end of the financial year instead of creating the accounts in the end.
Tax filings and returns are mandatory and needed to be done by every business for which they are applicable.