Corporate accounting is an activity that deals with analyzing, classifying, collecting, and presenting a company’s financial data.
It records business transactions systematically, making it convenient for businesses to monitor the day-to-day expenses which include financial accounts, income statements, cash flow statements, etc.
What is Corporate Accounting?
Corporate accounting encompasses multiple processes which include creating cash flow statements, financial records, and more. Through corporate accounting, it becomes easy to track several business activities like absorption, amalgamation, and more.
Corporate accounting facilitates overviewing of accounting transactions and procedures, helping businesses stay compliant with the rules and regulations of a governing body.
Importance of Corporate Accounting
Corporate accounting is critical to the successful functioning of a business. All government-registered businesses or companies need a corporate accountant. It helps organizations sail through financial, legal, and operational issues.
Corporate accounting helps businesses keep track of finances and records and keep it updated. The existing financial status of the company can be easily determined by such records. Lack of robust accounting results in financial hindrances, affecting business operations and related profitability
The preparation of income statements helps evaluate the net appreciation of business profit and loss. Such evaluation helps with proper cash flow management and helps businesses survive in the competitive business landscape.
Activities Involved in Corporate Accounting
Create and Supervise Company Accounting System
The process of company accounting starts with the creation, installation, regulation, and maintenance of a firm’s corporate accounting system. In the era of digitization, most firms opt for a software platform to regulate and analyze the overall accounting process. Separate accounts are created to manage different business particularities like income, assets, liabilities, equity, etc.
Further, advanced corporate accounting overviews the creation of different reports and financial statements meant to be used internally. Reports and financial statements are curated on the basis of current data. Financial statements issued are scrutinized by concerned regulatory bodies.
Processing Payroll for Staff
Computing staff salaries is an integral part of corporate accounting. Corporate accountants will compute the staff wages as per different work periods or designations. As per the corporate banking guidelines, the staff payroll checks or direct deposits are given out to bank accountants.
Special Expense Management
The management of special expenses also falls under the purview of corporate accounting. In order to be compliant with business regulations, firms are required to initiate special payments like performance bonuses, employee-related tax, payment for overtime etc.
Such responsibility is maintained under corporate accounting. The accounting book reflects that the payments are computed well, managed and cleared out on time.
Accounts Payable Management
The corporate accounting department also regulates the receiving and processing of the company’s incoming invoices. Based on the predefined payment mode, the accountant proceeds to clear out payments to the suppliers or contractors. Common instances of accounts payables are credit card payments, electronic payments, bank transfers etc.
With RazorpayX, it has become convenient for businesses to clear their payables and improve their financial condition. Offerings like the RazorpayX payroll facility enables businesses to automate payments in advance, offer insurance plans to employees and streamline business operation.
Accounts Receivable Management
Corporate accounting also deals with accounts receivables where accountants manage the payments that are coming from the client’s end. Further, instances of bad debts and defaulters are managed by a corporate accountant.
In well-established companies, a big team of accounts are assigned to deal with past-due accounts and secure business funding. Accounts receivables include payments, loans, purchases etc.
How does RazorpayX Assist Businesses ?
RazorpayX is gaining immense popularity with its notable services that have made the business accounting process seamless.
With the robust assistance of automated bookkeeping software, businesses can easily record financial transactions. This one-stop banking solution platform enables business owners to access current accounts, pay taxes, pay vendors etc., all from the single dashboard, thereby saving valuable time.
In addition, the flagship RazorpayX Forex service, intends to help startups gather funds globally keeping in mind meticulous compliance management. With robust assistance from a team of experts, startup businesses can streamline paperwork and regulate their overall business finances.
What is the difference between corporate and public accounting?
The major difference between corporate accounting and public accounting is the client number. In corporate accounting, a corporate accountant will look after all the financial records and transactions of one client. On the other hand, a public accountant deals with multiple clients and is generally related to government jobs and agencies.
What is the role of a corporate accountant?
A corporate accountant helps in basic bookkeeping, extending insights regarding financial analysis, planning budgets, preparing financial reports, management of expenses and account receivables etc.
What are some of the advantages and disadvantages of corporate accounting?
While corporate accounting monitors business budgets, this means of accounting takes only monetary terms into regard. Though the accounting process facilitates and improves business decisions, it might involve redundant paperwork.