Record keeping

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Why Keep Accurate Records?
To have an understanding of cash flow and what money is being spent on || As well as legally for tax purposes the 'tax man' needs to see records to know how much tax they want you to give
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What to remember when record keeping
CRIM! Communicating, Recording, Identifying, Measuring
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Communicating
Information must be in a suitable format
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Recording
Everything money has been spent on should be recorded
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Identifying
Must capture the financial data
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Measuring
Decide if you are calculating money or sales
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What to ensure?
Reliable - information is clear and legible & free from errors || Comparable with other firms || Relevant, data needs a purpose
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How can records help?
Aid decision making || Aid credit control || Illustrates financial position || Inland revenue need to know financial performance of firm
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Consequences of inaccurate records?
Sweet Papaya - won't know how much stock to buy, could buy too much which would lead to waste and money wasted - or not enough and customer confidence will lower and then they wont have enough customers to continue
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Consequences of inaccurate records?
Legally could be prosecuted || Prevent fraud, lots of people working there money could go missing
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Other cards in this set

Card 2

Front

CRIM! Communicating, Recording, Identifying, Measuring

Back

What to remember when record keeping

Card 3

Front

Information must be in a suitable format

Back

Preview of the back of card 3

Card 4

Front

Everything money has been spent on should be recorded

Back

Preview of the back of card 4

Card 5

Front

Must capture the financial data

Back

Preview of the back of card 5
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