Since all companies registered in Singapore must keep proper books of accounting as stipulated by the Singapore Companies Act, engaging an accounting specialist to help with your accounting, payroll and GST registration services is a good idea. Hence, Accounting and bookkeeping services in Singapore are more often outsourced to accounting services provider firms nowadays for its many benefits. This will help you fulfil the compliance requirements stipulated by ACRA and IRAS and avoid unnecessary penalties. With online bookkeeping services or freelance bookkeeping, the process becomes more productive as the work have accounted for correctly. However, technical knowledge, skills and experience are essential.
Although both accounting & bookkeeping services involve processes to record financial activities of tax, cash flow, performance for businesses but there is a difference between the terms. Accounting itself is the financial information system of all the work processes of recording, reporting, classifying with detailed and summarized data reports to analyze and get improvement on the business financial performance. Accounting initiates the process in the accounting information system for every company while bookkeeping is an act of record keeping which is an important part of the accounting process of which the service involves recording daily financial transactions chronologically.
Basic daily tasks of outsourced accounting services include:
- Collecting and filing all valid supporting documents necessary for the corporate activities, business transactions, secretarial work and ensuring the book of accounts in Singapore are accurate.
- Compile finance procedure manuals, preparing and providing the summarized reports for Singapore company financial statements and filing the yearly tax returns. The submission can be the responsibility of the bookkeeper or he can assist company accountants with the reports.
- Answering queries, providing and facilitating the support services during audit check.
Cycle of standard Singapore accounting
Beginning of Period Processing – Verify that all transactions for reversing entries in preceding periods have actually been reversed. This ensures that transactions are not recorded twice in the current period. Transactions are usually flagged as being reversing entries in the accounting software, so the reversal is automatic. Nonetheless, examine the accounts at the beginning of the period to check and verify the reversals. If a reversing flag was not set, an entry must be reversed manually, using a new journal entry.
Individual Transactions – The step required for individual transactions in the accounting process is to identify the transaction. First, determine what kind of transaction it may be. Prepare document. There is frequently a business document to be prepared or recognized to initiate the transaction. Identify accounts. Every business transaction is recorded in an account in the accounting database, such as a revenue, expense, asset, liability, or stockholders’ equity account. Identify which accounts are to be used to record the transaction. Record the transaction. Enter the transaction in the accounting system. This is done either with a journal entry or an on-line standard transaction form. These are part of the accounting process used to record individual business transactions in the accounting records.
Period-End Processing – The last steps in the accounting process are used to aggregate all of the information created in the preceding steps, and present it in the format of financial statements. First step is to Prepare trial balance. The trial balance is a listing of the ending balances in every account. The total of all the debits in the trial balance should equal the total of all the credits; if not, there was an error in the entry of the original transactions that must be find and corrected. Adjust the trial balance. It is compulsory to adjust the trial balance, either to correct errors or to accrue for revenues or expenses in the period. Prepare adjusted trial balance. This is the original trial balance, plus or minus all adjustments subsequently made. Next, preparing financial statements. Create the financial statements from the adjusted trial balance. The shareholders’ equity, asset, liability line items form the balance sheet, while the revenue expense line items form the income statement. Finally, Close the period. It is shifting the balances in the revenue and expense accounts into the retained earnings account, leaving them empty and ready to receive transactions for the next accounting period. Remember to prepare a post-closing trial balance. This version of the trial balance should have zero account balances for all revenue and expense accounts.
Range of book keeping and accounting services:
– Accounting/book keeping services on monthly / quarterly / half-yearly / yearly basis
– Bank reconciliation
– Preparation of management accounts (Balance sheet, Income statement)
– Preparation of sub-ledger listings (Fixed Asset / Accounts Payable / Accounts Receivable)
– Preparation of schedules for audit purpose