Accounts help

[karper]

Hi there,
I am at uni doing my BA in business and on a finance module at present. I am learning about income statements, balance sheets, PL account and trial balance.
At the moment they might as well as wrote it in a foreign language. Can anyone shed a little more light on compiling the documents and maybe point me to a site that explains it all. This is for sole trader, limited and not for profit.
Many thanks all

Karper
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[Scalloway]

The documents will be compiled from the accounting records of the business. Almost every business these days uses a computerised accounting program to record its transactions.

The accounting system will provide a trial balance at the touch of a button. This will be a categorised summary of all the transactions for the accounting period. It is called a balance because totals of both debits and credits must be equal (balance).

Income statement is the US term for the Profit and Loss Account. This statement lists all the revenue items for income and expenditure for the accounting period, giving a profit or loss.

The Balance Sheet lists assets and liabilities of the organisation.

Revenue is transactions that are used upo in the year, eg sales, purchases of goods for resale, services received in the year such as wages, heat and light etc.

Capital is items that have a lifetime of more than the accounting period. Assets are buildings, equipment etc. Liabilities are sums owed, suach as loans and owners' capital.

 

[jamjam11]

I will go the other road and keep paper accounts rather than trusting technology that might get an update and break everything or at worse case, Lose everything.
This is not rocket science for a sole trader. Everything needs recorded from day one of opening a business bank account and you putting money into that account.

Just whats been said to you already, Your debits and credits all need recorded and we do this by having separate accounts laid out in a table form.

This is one of the best links i feel i could give anyone..

https://www.youtube.com/channel/UCj4niow4ZV6ta_qecvFHf3Q

 

[jamjam11]

This would be a better link, It's the same guy just at the number one video..

 

[silverfirefly]

I will go the other road and keep paper accounts rather than trusting technology that might get an update and break everything or at worse case, Lose everything.

Actually any reputable SaaS company would not work like that. They test updates before pushing them to live production. And they have rigorous backup systems in place. Of course, there's nothing stopping you from downloading your data for the extra peace of mind.

 

[jamjam11]

Well the other side of this is that the information will be stored in a database more then likely Mysql so therefore you'd also be relying on the provider to provide security. Most people today think "cloud" And then think if its in the clouds how the hell would someone get into it. This is not the case, It's in a pc with a lot of databases made out of one huge database. Also you can download your information to store.. So therefore you have an SSL cert for secure line? And would you also be using "Hashing" to store the information in 128bit or higher?

Sorry when it comes to accounts and software I'd really just keep it in my safe in a book form. LOL After all this is sensitive information regarding your company. I had a quick look at some google storage, They're all very quick to tell you the price but not a mention on how they'd secure their servers {Storage} I use linux {Ubuntu} and I've built my own server with databases and i also set up firewalls/ip-tables/ along with other monitoring software to check backend ports being hit and files being requested and after going through all that i can tell you now with peace of mind.:

There's no WAY i would put my companies ledger in someone elses database.

 

[silverfirefly]

Sensitive information stored online has to be encrypted.

Sure there's always a tiny risk involved with cloud solutions, but there's also a small risk involved when you insist on using paper or offline software instead.

 

[jamjam11]

Reliance on other companies to store and encrypt your information in the right manner is not something that i would like to leave to other people. I recently upgraded my server entry key from 128bit to 256bit and even at that i am getting reports from other people that their server's been broken and their unsure how they got in.

There are hundreds of server entry points before you even start thinking of securing the database and companies that store information for other companies is 99% more likely to be attacked than someones home database. As for the information being encrypted, It was piece of software that done that, So therefore the process can be reversed.

I urge anyone in business to be sure you ask about security regarding anyone holding accountancy information. I deal with a piece of software called "ModSecurity" This is at the frontline against attacks written and shared freely. It's your information.

 

[Anna Chandley]

Frank Woods Business Accounting is a good book for beginners to accounting. Its a standard textbook for many accounting course so you might find a copy in your university library.