Companies carry out many daily operations during their work, which must be recorded continuously so as not to forget or be lost. Therefore, they record these operations in a detailed and daily form with records, books, and different types of operations. This is all called the “documentary cycle.”
The documentary cycle is the core of the company. It is responsible for recording all accounting statements. Therefore, it is of great importance to the company. We will explain the details of the accounting cycle and provide services.
?What is a documentary cycle
The documentary cycle is the first step of the accounting cycle, representing the itinerary prescribed for the accounting document within the company. It begins with the registration of each statement and process carried out daily in the form of accounting registration, through its proof of income list and financial position list, and ends with financial and tax reports
For the documentary cycle to form this role, it needs to meet the following conditions
Control and internal control of all company operations-
The documentary cycle helps facilitate process processes
Documents are uncomplicated, and their information is streamlined and fast registration
Documents provide all financial statements used to analyze data, record books, and prepare financial statements and reports.
?What is the importance of the documentary cycle
Accounting records and records are the most significant evidence of the company's work and the existence of financial operations carried out in it.
Provides objective data documented and recognized by government agencies.
A sound documentary cycle preserves the rights of project owners, buyers, and customers with the company financially.
Assign functions between departments and determine the responsibility of each department.
If operations are not recorded with documents, they are often not recognized between individuals, companies, or even legally.
It is a significant source of internal control over its financial and administrative actions.
The documentary cycle helps corporate managers make rational decisions.
The documentary cycle increases coherence and communication between company departments and departments.
It is the crucial element to provide financial statements, which means it is essential in determining the company's profits and taxes.
Documentary cycle steps
Record data in the journal.
Post the statement to the ledger.
Make a balance by auditing before making reconciliations.
Implementation of inventory and adjustments.
Prepare the audit balance list after the settlement is completed.
Prepare and process all accounts and financial statements.
Documentary session forms
:The document form includes several documents such as
Receipt of cash receipt
Cash disbursement receipt
Exchange authorization for all items in stores
Copies of audit minutes and receipt of goods in the store
Return authorizations to return items to the supplier
Disbursement authorizations for the distribution of items from stores
These steps can be divided into different types depending on each financial process, as :follows
Documentary cycle types
The documentary cycle is based on documents. These documents vary depending on the process of your record and can be divided as follows
Is the Documentary session a good tool for financial supervision for your company
Although the Documentary session is one of the most critical financial control tools, this is entirely unsafe because its adequacy is linked to its correctness. The more separation of posts, the stronger the adequacy of the document cycle; one staff member doing all the tasks of the documentary cycle certainly may expose him to omit or errors.
With the large size of companies, more than one party may share increased embezzlement and theft. You must need an external reviewer.
When the external auditor's task begins to examine the company's documentary cycle, in the separation of documents, the external auditor reviews each accounting record and ensures that the financial reports match what is contained therein. In the case of a merger between company documents, the auditor must verify the efficiency of separating each document and each document cycle.
Documentary Procurement Course and Its Importance
How does an external auditor examine the documentary cycle
Ensure the integrity of the document form and its general form and the presence of the document issuer’s logo
Ensure that the officials sign important documents and forms.
Review calculations and ensure that their results are correct and conform to what is mentioned in the model.
Review the invoices attached to the form along with the invoices of the party that issued the invoice.
Is there a difference between the documentary cycle and the accounting cycle
The accounting cycle includes a summary of all policies and procedures of financial operations, which take place during the accounting period, including analysis, registration tab and even access to the company’s final financial statements.
The documentary cycle represents the tools used to complete the accounting cycle, which pertains to each document and record approved, legally valid and documented for the execution of financial transactions.
An accounting cycle is a constant process for each company whose phases do not change from place to place, while the documentary cycle can change depending on the size and nature of each company.
?What services do accounting offices provide for the documentary cycle
ECPA Office is One of the best accounting offices in Egypt and the Arab world, an integrated team of certified consultants and experts in accounting, auditing and taxation. We provide the best accounting and legal services with the latest technology tools and digital means
One of the most important accounting services we provide to you
Writing and preparing journal entries
Daily posting of revenue and sales items
posting of items of receivable and payments
Calculate fixed assets and depreciation value
Post accounts of items entering and out of stores
Settlements for deductibles and credit accounts
Manage and prepare documentary credits
Preparing the general budget
Processing a cash flow list
Review journals and posting entries
Verify the authenticity of documents through a thorough documentary examination
Record purchase and sell invoices
Calculate net profit and loss
Prepare letters of guarantee
Detailed accounts payable reports
Evaluate your company's documentary cycle
Correct registration errors and detect any manipulation
Many accounting, tax and external auditing services
ECPA office is One of the largest Chartered Accountants offices in Cairo, we promise to take responsibility for recording all your company's financial operations and help you ensure the expansion and upgrading of your company. Contact us now to get our best offers for new customers