7 key Steps in the Accounting Process Every Business Need to Know

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7 key steps in the Accounting Process Every
Business Need to Know
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To understand and properly execute all the
necessary steps in the accounting cycle the
companies are advised to enlist the services of
the best accounting bookkeeping firms in the
UAE.
PARSH ACCOUNTING AND BOOKKEEPING
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The Accounting Cycle
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The process of accounting is crucial for every
successful company in the UAE and the business
needs to have a proper accounting process within
the organization. The financial statements of the
company present an accurate picture over a
Financial period. The steps in the accounting
cycle help the businesses in presenting a clear
view of the financial health of the organization.
PARSH ACCOUNTING AND BOOKKEEPING
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The Accounting Cycle The Key Steps in the
Accounting Process
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Identifying and Analyzing Business Transactions
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Analyzing the transactions is the first yet
crucial step in the whole accounting process.
The companies need to identify the accounts that
are affected by the transactions. The process
involves analyzing source documents like the
purchase orders, invoices, loan agreements,
receipts, etc. that are the evidence or records
for business transactions in the company. The
companies should avoid mixing personal and
business transactions.
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Posting Transactions in Journals

• The next step in the accounting cycle is
  journalizing the transactions. The outsourced
  accounting firms in the UAE can make sure that
  all the financial information pertaining to the
  business has been recorded in the journal. This
  process is complete with using the double-entry
  system of bookkeeping, where the transactions
  are recorded in debit and credit accounts. The
  journal carries the date and description and
  name of the payee and payer of the transactions.

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Posting from Journal to Ledger
The financial information recorded in the
journal book, both debit, and credit, now put
into the ledger. The ledger is also referred to
as the book of final entry and it shows the
companys accounts and the changes it underwent
due to various business transactions. All the
debit and credit journal cash transactions will
be transferred to the cash ledger.
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Recording adjusting entries

• The accountants in the UAE at this stage will
  record the adjusting entries to update the
  accounts before summarizing them in the
  financial statement. The entries will be
  journalized and posted to the ledger.

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Preparing the adjusted trial balance
After the new entries are created, the
businesses got to calculate a new trial balance
to check if the debits are equal to the credits.
it is an important phase in the accounting cycle
where an accounting firm starting to prepare for
the financial statements of the company. and any
error detected in the adjusted trial balance
needs immediate correction.
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Preparing financial statements
The financial statements of corporations are
statements such as Income Statement Balance
Sheet Cash flow Statement Posting closing
entries The accounting period ends, the
temporary accounts are closed or reduced to
zero. These include expenses, income, and
withdrawal accounts. It must be noted that the
closing entries are made for temporary accounts
and not for permanent
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Post-Closing Trial Balance
After the closing of the trial balance, the book
now consists only of permanent entries like
assets, liabilities, and owners equity. This
step makes sure of the proper closure of revenue
and expense accounts. It also aims to ensure
that total debit and credit are equal. the
businesses have to be compelled to recheck the
book again for errors and correct them.
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