CONTROL ACCOUNTS RECONCILIATION
Book Keeping is a science to get your financials accurate. Govern by accounting standards, business should take care in maintaining accuracy of their books of accounts. Control Accounts are one of the major part when closing periodic nominal ledger. To get correct balances it is a must that control accounts are properly reconciled and correct amounts are transferred to profit and loss account.
When it comes to keeping the accounts for a small business, a single accounting general ledger is usually sufficient, however for larger companies where transactions are too numerous to be dealt with by a single person there is a need for subsidiary ledgers, or a double entry system. To facilitate the extraction of trial balances, a control account must therefore be maintain in the company’s general ledge for the subsidiary ledgers.
BENEFITS OF CONTROL ACCOUNTS
There are several benefits that come with having a control account:
- A single trial balance can be more easily extracted
- If it is discovered that the trial balance doesn’t balance, fewer accounts require checking for errors
- Different people are able to maintain nominal ledger to check against fraud
- A control account speeds the process of generating management accounts information
- Cut down on the amount of detail required in the general ledger
Advice for Reconciliations
Knowing the way in which control accounts function and where potential mistakes can occur is a key element when it comes to online bookkeeping and can be quite difficult to manage when accountancy is not the main focus of your business.
Rely on The Accountancy Solutions to handle your control counts for you so that you are free to focus on the important elements of running your business. Our skill and expertise in the accountancy industry ensures that your company benefits from having control accounts without the challenges of having to deal with them yourself.