Overview
Accurate books of account are the base for every other compliance: GST returns, TDS, income tax, audit and management reporting. Bookkeeping covers recording transactions, reconciling bank and party balances, and closing the books each month.
Companies must maintain books on an accrual basis under double entry, and accounting software used by companies must have an audit trail (edit log) feature that cannot be disabled.
Who needs this service
Legal and regulatory framework
- Companies Act, 2013: Section 128 and the audit trail requirement under the Companies (Accounts) Rules, 2014
- Income-tax law on maintenance of books
- CGST Act, 2017: Section 35 on accounts and records
Scope of services
Recording
- Sales, purchases, expenses and receipts
- Payroll accounting
- Fixed asset register
Reconciliation
- Bank reconciliation
- Customer and vendor ledgers
- GST and TDS reconciliation with books
Closing
- Monthly closing and provisions
- Trial balance and summary reports
How the engagement works
- Set-upChart of accounts and software set-up.
- Monthly processingRecording and reconciliation.
- ReviewMonthly review and closing.
- ReportingMonthly summary to management.
Documents typically required
Key forms and due dates
| Item | Timeline |
|---|---|
| Monthly closing | By the 10th of the following month, ahead of GST and TDS due dates |
Deliverables
- Updated books of account
- Monthly trial balance and reconciliations
- Summary financial report
The scope of each engagement is agreed in writing and depends on the nature, size and regulatory requirements of the entity.
Frequently asked questions
How long must books be preserved?
Companies must keep books for 8 years; GST records must be kept for 72 months from the due date of the annual return.
Can books be kept in any software?
Yes, but companies must use software with an audit trail that records every change and cannot be disabled.