The Accounting Process

Even though you will likely delegate most of the accounting functions to others, you must have a basic understanding of your accounting system. You are ultimately responsible to ensure all duties under Part 15 of the Rules are carried out (Rule 1502). You cannot rely on your bank or your staff to take responsibility for you.

Be cautious about taking advice from your bank and always verify that the advice conforms to the Rules. Some bank information is unintentionally misleading.

Basic Steps of the Accounting Process

There are three basic steps in the accounting process:

1. Record transactions in the accounting records.

2. Prove the accuracy of the recording (balance/reconciliation).

3. Produce financial information and filings such as financial statements, government filings for GST, PST, income tax etc.

For a pictorial overview of the accounting process see Appendix A: The Accounting Process.