Skip to content

Who is required to keep track of the accounting?

December 8, 2019
Who is required to keep track of the accounting

When starting an activity or business, we are sometimes asked the question of whether there is an obligation or not to keep a regulated control of all the income and expenses of the organization. This fact varies depending on each country and Administration, so it is necessary to know the legislation and obligations that exist; In the case of Spain, it is Art. 25 of the Commercial Code that regulates this control of the accounts. In this article, we explain in more detail who is obliged to keep track of accounting.

Steps to follow:

1. As we pointed out in the introduction, each State will have its own regulation as regards this issue. So you must refer to the legislation of the country you are in to verify who is obliged to keep track of the accounting.

2. “Every entrepreneur must keep an orderly accounting, appropriate to the activity of his Company that allows chronological monitoring of all its operations, as well as the periodic development of balance sheets and inventories. It will necessarily, without prejudice to the provisions of the laws or special provisions, a book of Inventories and Annual Accounts and another Journal.

3. In this way, both limited companies, such as corporations, labor, and cooperatives must register all operations carried out in order to know their assets and calculate the results.

4. Even so, it should be noted that, in general, those companies that do not function through commercial companies are not obliged to keep an official accounting, they are therefore self-employed.

5. The purpose of this accounting record is internal and external, that is, it will help those who are in charge of said economic activity to know the status of their accounts at all times; and, at the same time, it is a mechanism of control of the Tax Administration, to guarantee that the corresponding thing is being declared and the correct taxes are paid.

6. That is why keeping your organization’s accounting is so important and we must do it exhaustively. In case you do not have enough knowledge, we recommend that you opt for an online accounting manager, such as the one offered on the many websites, a simple tool to keep the accounting management of your business personally, along with the labor, tax, and accounting advice you need.