Basic Records or Documents Needed for Building Your Accounts

Some fundamental basic records are to be maintained for building any type of Accounts, whether it is your Individual Account, Business Account, or any other fields that attract income-tax. You cannot create or maintain an account from the air without having any basic record that supports your transaction. These basic records or papers are the most essential and important foundations for an accountant or auditor to create or maintain accounts and verify their authenticity.

Some of the essential documents are being discussed below.

Purchase Bills
Bills of any purchases, whether cash or credit purchase, are to be safely maintained as your primary record. You make entries from these bills by preparing vouchers. So these bills should be kept safely either pinned to the vouchers or in separate files. If kept in files, you need to maintain various files according to the nature of transactions and the account head of that purchase. In that case, you may pin the duplicate copies or xerox of the bills along with those vouchers.

Sales Bills

When you make sales, you will be preparing bills for providing to your customers. There may be cash and credit bills. One copy of the bill is to be safely maintained by you for a record and for preparing your accounting entries. Cash bills may be enclosed with your sale vouchers. But credit bills are to be kept separately in files and copies of them may be enclosed with the voucher if possible. Because, if transactions are too many, you cannot enclose all bills with vouchers. In that case, you can give the bill number and date in your vouchers and keep the bills in files.

Assets Purchase and Sale Records

You need to maintain these bills also for calculating the value of assets that are of significant value in your possession. If you sell any of them, keep the record of sale value and date of sale with evidence.

Vouchers

Vouchers can be Cash voucher or Bank voucher or Journal voucher according to the nature of transactions.

• Cash vouchers are made for cash transactions when you purchase in cash or sell against cash. You can keep the cash bills enclosed with the vouchers. But if you make any big purchase like assets or equipment, you need to maintain the bills in secured files and only copies may be attached with vouchers.
• Bank vouchers are prepared for entering bank transactions. If you purchase by giving cheques or sell by receiving cheques or drafts, these bank vouchers are prepared. Here also, tiny payment bills may be enclosed with the vouchers and big payment bills need to be kept in relevant files for a safe record.
• Journal vouchers are prepared for transactions other than cash or bank payments. These can be prepared for monthly total entries against sales or purchase day books or for any internal transfer accounts and adjustments or for salaries and wages sheets and depreciation accounting, etc.

Business Property Documents

Whatever property you hold in the name of your business requires proof of the holder, its authenticity, and valuation. You should be able to justify your property and its valuation and its holdings duly certified or verified by some legal authority.

Passbook

If you are holding Bank or Post office accounts, you should keep the passbooks properly updated from time to time for verifying and making entries in your account books. Your entries should always be tallied with the passbook entries and keep everything updated.