bookkeeping
Definition
Noun: The systematic recording, organizing, and maintaining of financial transactions for a business or organization. It is the foundational process of accounting, involving the day-to-day task of logging all income and expenditures.
Usage
Bookkeeping is an essential administrative function. It is typically performed by a bookkeeper and involves using ledgers, journals, or specialized software. The term is used as a non-count noun to describe the overall activity or profession.
Examples
- Accurate bookkeeping is crucial for understanding a company's financial health.
- She handles all the bookkeeping for the small family business.
- Modern bookkeeping often relies on digital software instead of paper ledgers.
Advanced Usage
- Double-entry bookkeeping: The standard system where every transaction is entered twice, as both a debit and a credit in different accounts, to maintain the accounting equation (Assets = Liabilities + Equity).
- The company adopted double-entry bookkeeping for greater accuracy.
- Single-entry bookkeeping: A simpler system similar to maintaining a check register, recording only one entry per transaction. It is often used by very small businesses or for personal finances.
- For his freelance work, he uses a basic single-entry bookkeeping method.
Variants and Related Words
- Bookkeeper (n): A person whose job is to keep records of financial transactions.
- The bookkeeper reconciles the bank statements every month.
- Bookkeep (v, rare): To perform the task of bookkeeping. (Note: This verb form is less common; "do the bookkeeping" or "keep the books" are more frequent.)
- He bookkeeps for several local shops.
Synonyms
- Record-keeping: The general act of maintaining records, which can include non-financial information.
- Accounting: A broader field that includes bookkeeping but also involves interpreting, classifying, analyzing, and reporting financial data.
Related Phrases
- To keep the books: An idiomatic phrase meaning to perform bookkeeping duties.
- Who keeps the books for your organization?
- Books of account: The formal ledgers and journals where financial transactions are recorded.
- The auditor examined the books of account for the fiscal year.
Noun
-
the activity of recording business transactions
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