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.
The steps required for individual transactions in the accounting process are: 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.
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 steps 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 , Prepare 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.
What are the important deadlines?
- Financial Year End (FYE) – You choose any date like March 31st
- Estimated Chargeable Income – 3 months after FYE
- The Annual Tax Returns – November 30th Year after FYE
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