Bookkeeping is the process of recording financial transactions regularly of a company, Sacco or any other cooperate institutions carrying out business operations. Effective bookkeeping enhance track record of all information that aid in operations, investment and decision making when it comes to financial issues such as expenditures, incoming revenue and deductible tax.
The process of bookkeeping include.
- Creating and sending invoices
- Entering and processing payments
- Tracking receipts and reimbursements
- Reconciling accounts
- Processing payroll
- Preparing initial financial reports
Benefits of bookkeeping in a Sacco
- Reliable Performance
Accurate and reliable bookkeeping is crucial to external and internal users such as investors (new and existing Sacco members). A SACCO with a track record of good bookkeeping practices attracts more members. This is because anyone will feel comfortable joining a SACCO is well organized and keeps its records well.
- Accountability in a SACCO
SACCO members are able to know how much money comes in, how much money goes out of the SACCO and the exact money they are earning at the end of every financial year. In addition the members are also aware of how much profits they have made yearly in a very transparent way.
- Compliance
For a Sacco to keep safe in the CRAs good books, bookkeeping can help keep track of compliant with the ever-changing rules and regulations. Not only can this save the Sacco from expensive fines and penalties, but it can also help prevent an audit, which could impede the growth of the Sacco.