What is accounting?
Accounting means summarizing all the most important figures for a company’s operations, which are income, expenses, assets and liabilities. Based on this information, the company’s performance and assets can be determined.
The accounting methods used vary depending on, among other things, the type of company or the size of the business. More on these different methods on this page.
Who is doing accounting?
The most important thing is that the accounting is done by a professional who is familiar with the legislation and accounting instructions as well as regulations. Some companies do the accounting themselves, but usually the company already in the start-up phase competes with an accounting firm, which takes care of all the accounting work from the beginning. However, some companies are able to cope with their accounting obligations themselves, but this is always accompanied by a choice of where the entrepreneur spends his or her time and whether he or she certainly has up-to-date knowledge of accounting matters.
Bookkeeping (or accounting) services are an important part of a company’s success. Without high-quality accounting, the company does not meet the requirements of the law and the company is not able to manage the finances properly.
We offer companies, regardless of size, an affordable (49.90 € / month) and clear service, where we take care of everything the customer needs. We want to be an accounting partner from whom you can always ask for help in everyday matters.
An enterprise’s financial year refers to the period during which transactions are accounted for and transactions are closed with financial statements that bundle the events of the previous period. The length of the financial year is usually 12 months, but there are also exceptions here, such as new or closing companies.
The Accounting Act defines the minimum requirements for accounting and financial reporting requirements. The Accounting Act determines, for example, the storage and safekeeping of documents.
Read more: Accounting law in finnish
Accounts payable are provisions for invoices caused by the company’s purchases, which the company has not yet paid.
Accounts receivable refers to a company’s receivables that help you make more payments. The monitoring of trade receivables has a significant impact on those companies that sell a lot on credit, ie they generate a lot of trade receivables.
An accountant (or bookkeeper) is an accounting professional who takes care of clients bookkeeping tasks.
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Payment-based accounting means that transactions are recorded in the accounts when a payment is made or when a company receives a payment, for example, from its customers.
In accrual accounting, transactions are recorded on the date on which the transaction occurs. For example, for a sales invoice, for the day the sales invoice is posted.
VAT is a so-called consumption tax that affects almost all products and services. The selling party adds VAT to the price of the product or service being sold, the amount of which varies between the services and products.
The general VAT rate in Finland is 24%, but other taxes are also used.
Read more here.
The general ledger is one of many accounting reports. The general ledger contains all the company’s transactions broken down into accounting accounts.