The accounting cycle does not differ from one establishment to another, regardless of its workload. The accounting cycle is about recording all financial procedures and events and posting them to access income accounts, financial position, and budget. However, the documentary cycle means the set of documents prepared for monitoring all financial transactions and events Facility accounts.
Through this, we can conclude that the documentary cycle is a tool to approve the accuracy of the accounting cycle results. It also represents a border in front of any gaps or defects that allow embezzlement or manipulation of the company’s funds. Therefore, the documentary cycle plays a significant role within the establishment and is different from the accounting cycle. Below we will cover the documentary accounting cycle, its definition, and its forms
Separating the procurement and warehouse departments leads to the loss of the company's assets, and the greater the link between them, the greater the control over the company's assets
What is a Documentary Cycle ?
The Documentary cycle represents the first phase of the accounting cycle. It means all the documents, records, and papers related to the company's accounts. Since the beginning of their registration until the completion of their posting and ensuring the integrity of each statement. The accounting documentary cycle is the main source for recording operations that financial statements and final reports are based on
The importance of the documentary cycle
Documents are the first proof that an enterprise carries out financial operations
Investors, government agencies, and all customers with the establishment have their first argumen documents. They cannot base their dealings with the establishment on oral statements and conversations
Business owners and companies leave financial matters to an accounting office or chartered accountant, and what proves their work is documented
Documents are the first guide to the work of the internal auditor. He reviews all accounts, cash, expenses, etc., and ensures that they are recorded accurately with documents
Financial statements and tax returns are based on the accounting document
Documentary Cycle types
The documentary cycles vary from one company to another, and the Egyptian Certified public Accountants "ECPA" office provides different services to prepare a public accounts program that helps your company manage the documentary cycle of various types. For example, the documentary course for real estate investment companies needs a public accounts program such as the program Real estate investment that takes into account the recording of advance payments, the costs of operations, works under implementation
Elements related to the warehouse documentary cycle include
Records of inspection and receipt of goods
Exchange permissions for products
Return permissions from sold products
Warehouse Documentary Cycle
What is the warehouse documentary cycle? It means the transitions of documents for all goods and materials coming out and entering into the warehouses. Starting from the beginning of receiving the goods until the final inventory. It is considered the first step of the accounting documentary cycle
Warehouse Management: How Our Program Can Benefit Your Business
Record restrictions directly in the journal
Instant migration to the ledger
Make a balance for review before and after settlement
Prepare result statements (income statement and financial position)
The warehouse management program provides periodic and real-time reports
Warehouse Documentary Cycle Forms
Of course, the documentary cycle of stores will vary depending on the company's activity and the size of its operations. Examples of warehouse documentary cycle forms include
Sales documentary cycle
Price requests from the customer include the company, offers issued by the company, the sales and supply orders, sales invoices from the company to customers, the issuance of goods to customers, and the receipt of cash receipts from the company to customers
Procurement documentary cycle
It consists of purchase orders, quotations, purchase or supply orders, purchase invoices, notifications of receipt of goods from suppliers, and cash disbursement authorizations from the facility to suppliers. To make the most benefit, you can use the electronic invoice program through our office
Customer Accounts Documentary Cycle
It means the movement of documents related to each customer and their transactions with the establishment, including sales, disbursement permits, invoices, receipts, etc. The documentary cycle of customer accounts varies according to the size and type of activity.
The documentary cycle for customer accounts is also compatible with what we offer in the human resources program and customer management program CRM. Customer management CRM is a complete tool or program that companies currently follow to improve relationship management with their existing customers
Why is a customer management program important in CRM
Increase the number of potential new customers
Closer relationships with old customers
Collect and organize all possible information about your customers and employ it to suit your business and the nature of your products
Identify which services or products are best for the customer and provide them in the best form
The accounting Cycle can be defined as the policies and laws followed by the company to register its financial operations, from recording, numbering, analyzing, summarizing, and posting to benefit from it in accessing the design of reports and financial statements of the company to know the result of the company’s business. It is implemented by a chartered accountant or office Accounting handled by the company.
When is the accounting cycle prepared
The accounting cycle is prepared from the beginning of the financial period and once the financial operations occur. All transactions carried out by the company during the period are recorded then the financial statements are prepared at the end of the period based on the operations carried out. The steps of the accounting cycle vary from one company to another, but it is customary to start on 1/7 and end on 31/6 the following year.
?What are the stages of the accounting cycle
The accounting cycle begins with the occurrence of financial transactions in the company during the financial period, analyzing them and recording them in the journal.
Migrate all recorded transaction restrictions to the general ledger.
Compile the total balances of all accounts to make the trial balance.
Make final adjustments for the financial period.
Establishment of the trial balance after settlements.
At the end of the accounting cycle, financial statements such as the statement of financial position, the list of cash flows and net profit are made, final reports are issued, and accounts are closed and rotated.
How to Register Accounting Entries
To make registration of daily restrictions, it is necessary to first count all the company's assets and obligations
Perhaps posting the entries requires first the calculation of the company's assets and liabilities
Ensure the ownership documents of the company's current and non-current assets
If the company is not bounded by records, it must be prepared for emergency obligations such as tax obligations, suppliers, etc
Double entry is used as a method of recording accounting operations
Every transaction is posted from one account to another account
The parties that relate to the registration of accounting entries are the debtor, creditor, statement, cost center, registration number, date, and the professor's page number
All accounting entries are posted to the general ledger, which is responsible for recording permanent entries
Activation process example
The journal plays a crucial role in the accounting cycle. All stages of the accounting cycle are based on the accounting entries recorded in the journal. The journal form is made manually or through the Excel program or a general accounts program
The journal form consists of main columns
The accounting company “ECPA” provides a public accounting program based on the latest technological tools that help facilitate the stages of the accounting cycle and the documentary cycle to the maximum extent
What features does the public accounts program provide
Making an electronic invoice
Creating a journal and automatically recording and posting accounting entries
Supports the feature of importing your accounting data from the Excel program
It offers several programs in one
Warehouse management program
CRM customer management
Accounting software for manufacturing
Human resources program
Creating a chart of accounts with unlimited levels
Facilitate the management of your company and its branches
Facilitate asset management and cost centers
Periodic reports, fixed asset reports, audit balance, financial statements, and professor accounts.
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