A creditor is a person or organisation to whom a company owes money. This is because products or services have been delivered that have not yet been paid for. Managing these debts (short-term liabilities), or accounts payable, is essential for healthy business operations. Creditors are a crucial component of working … […]
A credit note or credit invoice is a document issued by a supplier to a customer as a refund for returned goods or as a correction to a previous invoice. It is proof of settlement and is used to reduce outstanding debts or as a credit for future purchases. What … […]
A debtor is a person or organisation that still has a payment obligation to another. Usually in the form of an outstanding invoice. This can range from individuals who owe money to shops to companies that need to make payments to suppliers. Debtors are an essential part of a company’s … […]
Foreign currencies are currencies that come from a country other than the one in which they are used. They are often used for international trade and financial transactions. Their value is determined by exchange rates and can fluctuate based on various factors such as economic and political developments. How do … […]
Direct debit is a payment method that authorises a company to regularly debit money from a customer’s account. This process is automated according to a preset frequency and amount. This makes it easy for both the customer and the company to manage financial transactions without manual intervention. What must a … […]
A general ledger account (ledger) is an accounting term that refers to a central record of all financial transactions carried out by a company. It records all debit and credit entries in a clear and structured system. Companies use these accounts to analyse and report financial position and performance. They … […]
An invoice is an official document that records the details of a transaction between a supplier and a buyer. It states the goods or services provided and the cost. It is used as proof of purchase and to request payment within a set deadline. Invoices are important for tracking financial … […]
A journal is a register in which financial transactions are recorded chronologically. It serves as the basis for preparing financial statements. Difference between journal and general ledger In a financial accounting system, both the journal and the general ledger perform important functions, but they serve different purposes. For instance, the … […]
A journal entry is an accounting note that records financial transactions. It documents each individual transaction by indicating the debit and credit side of the account, including relevant details such as date, amounts and accounts. Journal entries form the basis for preparing financial statements. Requirements of a journal entry A … […]
Line recognition is the process of detecting specific information within a line of text on an invoice, such as amounts, dates or supplier details. Software used applies advanced algorithms to analyse the structure of the invoice and extract relevant data. This helps to process invoices more efficiently and reduce manual … […]
Machine learning is a subfield of artificial intelligence that focuses on the development of algorithms and statistical models that allow computers to recognise patterns in data and learn from them. This technology uses various techniques, such as neural networks, decision trees and regression analysis, to make predictions or decisions without … […]
Optical Character Recognition (OCR) is a technology that converts images of text into editable and searchable data. The process starts by scanning a document, creating a digital image. OCR software then analyses the structure of the text, recognises characters and words, and converts them into digital text files. This technology … […]
A purchase journal is a register that records all of a company’s purchasing transactions. It contains information on purchases of goods and services, including supplier details, date of purchase, quantities and costs. It serves as an important tool for keeping financial records and managing inventory. Why do I need to … […]
Robotic accounting is the use of software robots, or RPA (Robotic Process Automation), to automate repetitive accounting tasks. What does it deliver? By automating processes such as data collection, invoicing and financial reporting, human error is reduced and efficiency is increased. Robotic accounting ensures that accounting data is processed consistently … […]
A retention obligation is a legal requirement for companies and organisations to keep certain data and documents for a certain period of time. This aims to ensure transparency, accountability and legal compliance. European laws and regulations In Europe, retention requirements are regulated by various directives and regulations, including the General … […]
A sales journal is a register that records sales transactions, including details of products or services sold, prices, and payment information. It serves as an important tool for companies to track sales performance, analyse trends and prepare financial reports. Why do I keep a sales journal? Using a sales journal … […]
Scan and recognition is a process that converts images or documents into digital information using optical character recognition (OCR). This technology identifies and interprets text and other features, enabling automated processing and analysis. Applications of scan and recognition Scan and recognition is used in various sectors, such as administration, logistics … […]
Value-added tax, or VAT, is a sales tax levied by the government on the sale of goods and services. Every entrepreneur must charge this tax to customers, collect it and remit it to the tax authorities. Registering and remitting VAT To remit VAT correctly, entrepreneurs must first register with the … […]
VAT reverse charge is an arrangement that shifts the responsibility for paying VAT from the supplier (seller) to the customer (buyer). This scheme is used in transactions between companies from different EU countries or in sectors susceptible to fraud. The buyer pays the VAT directly to the tax authorities. Benefits … […]
An accrual entry is a temporary financial record used to record transient or provisional transactions, such as prepayments or receipts that have not yet been processed in the accounts. Its purpose is to correct financial reporting and ensure the accuracy of operating results while the company waits for the transaction … […]
Accounting is the systematic recording, organisation and analysis of a company’s financial transactions. It involves recording income, expenses and other financial activities to maintain an accurate record of an organisation’s financial health. Administration vs accounting Administration involves recording and managing all business transactions and documents within an organisation. This includes … […]
Administration refers to the systematic recording, organisation and management of financial and other relevant data within an organisation. It includes keeping track of income, expenses, invoices, salaries and other relevant transactions. But it also includes preparing reports and complying with legal obligations. Why keep records? Sound accounting, the financial part … […]
An audit trail is a detailed, chronological record of events, activities or changes within a system or process. It provides insight into who performed which actions, when these actions took place and which parts of the system or process were affected. When are audit trails important? Audit trails are often … […]
Authorisation is the process of assigning and approving documents to a user. This process determines who can access and approve documents. Why approve documents? Authorising documents ensures the integrity and confidentiality of information. It also constitutes an additional check before a document is further processed. Think here about catching phantom … […]
Confirmation is the granting of power of representation to a person to act on behalf of an organisation, such as a company. This power is often granted to employees who are allowed to make decisions and take actions in the course of business. What are the benefits? Within companies, confirmation … […]
A cost centre is a specific department, location or entity within an organisation whose costs are analysed, allocated and controlled. It acts as a centre for cost control and analysis, allocating costs to specific activities, projects or products. This allocation enables organisations to understand the cost structure, control costs and … […]
A cost unit is an entity, such as a product, service or department, that bears costs directly attributable to it. It can also be used to allocate indirect costs to specific activities or purposes within an organisation. Cost units help in understanding cost structures and making decisions based on cost … […]
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