Full Accounting Krakow

What is full accounting? Is it profitable? What are the limits? Can I voluntarily switch to full accounting? What are the advantages and disadvantages of full accounting?

I will answer these and many other questions below.

Trading books

Full ledgers in popular opinion are associated with a complicated, difficult and expensive process of managing accounting records. In fact full accounting is simply one of the systems of recording income, costs and assets of a company. My bookkeeping services also include commercial books.

Importantly, it includes the value of assets included in equipment, fixed assets, goods and in accounts and cash. This is why it is so extremely precise and reliable.

Full accounting in details

What is full accounting?

What is full accountingBookkeeping is a part of accounting. It is an extremely extensive, formalized and at first glance complicated system of recording economic events. Commercial books include the record of economic events throughout the fiscal year.

What is important, bookkeeping is not only used for recording revenues, costs or calculating taxes due. It serves first of all to create a full picture of financial situation of a business. Thanks to generating detailed information about financial situation, keeping full accounting can help an entrepreneur, especially a beginner. Detailed analytical data optimize the efficiency of managing financial flow processes in a company.

What is more, full accounting can be an invaluable tool used, among others, to control the financial situation of a company and to analyse profits and losses incurred by the company.

What makes the books of business different?

What distinguishes full accountingIn contrast to the simplified accounting based on the Revenue and Expenses Ledger (KPiR), in full accounting every smallest and seemingly insignificant operation such as cash receipts, bank transfers, payment for goods or compensation is reflected in the accounting records.

What distinguishes a full accounting service and at the same time makes it the most complicated is the double entry system. It consists in posting each operation on two independent accounts. Therefore every, even the smallest monetary operation will not go unnoticed and will be reflected in the records.

This type of records takes into account all non-cash transactions, such as decrease in the value of fixed assets, which may affect the financial results of the company. To provide entrepreneurs with a sense of security, all the rules of recording business transactions are unified.

In summary, bookkeeping, as opposed to simplified accounting, gives the possibility of obtaining, and then analyzing and monitoring all data and information related to the financial situation of the company.

Full accounting mandatory or voluntary?

Choosing the right form of taxation is extremely important because the decision taken in this regard will affect the way the company's accounts are kept. Accounting is in fact the basis for the structure of the entire enterprise and all financial processes occurring in it.

When is it mandatory?

In practice, certain groups of business entities do not have to solve the dilemma of whether to keep a commercial ledger or choose one of the simplified forms of taxation.

The legislator has imposed the obligation to keep books of account on the following entities:

  • commercial companies and civil partnerships excluding the State Treasury and the National Bank of Poland,
  • natural persons, civil law partnerships of natural persons, general partnerships of natural persons and partner companies, which net revenue exceeds EUR 2,000,000 in Polish currency,
  • organisational units acting pursuant to the Banking Law, the Law on Trading in Securities, the Law on Investment Funds, the Law on Insurance and Reinsurance Activity, the Law on Cooperative Savings and Credit Unions or the Law on the Organisation and Operation of Pension Funds,
  • administrative units such as: municipalities, districts and provinces with their associations, branches and representative offices of foreign enterprises

Nothing prevents a sole proprietorship or a small partnership from keeping the books.

Theoretically, even the smallest business entity can keep full accounts.

The choice of this solution should be considered by all entrepreneurs who care for constant control over company's finances. On the other hand, high costs of this solution and its advanced level of complexity cause that full accounting is chosen mainly by larger organisational units able to meet all requirements connected with it.

However, if you decide to switch voluntarily to business books, switching from P&L to full accounting should be no problem at all. I can help you with that.

Advantages and disadvantages

Advantages and disadvantages of full accountingBelow I will outline the pros and cons and benefits of full service bookkeeping.

What are the advantages of full accounting?

Despite the fact that full accounting is a very complicated way of accounting, there are a lot of benefits to be gained by using this method of accounting.

The undoubted advantages of bookkeeping are:

  • obtaining accurate information on all cash flows and each transaction, allows to control and analyze expenses, costs and sources of income received,
  • obtaining a full picture of the company's financial situation due to an accurate valuation of assets,
  • facilitates the planning of future investments,
  • data from the balance sheet and income statement allow the calculation of cash flows, which reflect the actual cash available,
  • the possibility of ongoing monitoring of changes on the basis of accurate records of company assets,
  • obtaining indicators helpful in taking actions aimed at improving functioning and development of specific segments of the company
What are the disadvantages of full accounting?

Full accounting also has downsides, and the most commonly highlighted are:

  • Increased costs, due to the fact that bookkeeping is a difficult and complicated task and requires a lot of knowledge. This knowledge and experience is connected with hiring a professional accountant or an accounting office.
  • The need to comply with the directives of the Accounting Act. This is also my task as an accountant.

To sum up, full accounting imposes much more obligations on an entrepreneur than simplified accounting. Nevertheless, their implementation does not mean that an extended form of revenue and expense register is only an onerous duty and higher costs - it has its advantages.

Greater accuracy and attention to detail allows you to better analyze the turnover of money in your business. With this information, it is possible to optimally plan expenses and investments and predict tax issues for the future. Full accounting also means greater transparency, which helps build trust in the brand, as well as attract investors and customers.

More and more conscious entrepreneurs are voluntarily changing the form of keeping accounting records to full accounting. Full accounting is voluntarily used by companies mainly because it gives the company's management a lot of information about financial processes taking place in the company. Thanks to financial statements it is possible to develop optimal budget and tax policy.

Important tax deadlines

taxpayers on tax card settle accounts by the7th day of each month;

by the 20th day of each month, a flat-rate tax on registered income is paid;

until the 20th day of each month advance payments are made for income tax on persons conducting business on general terms;

advance payments for corporate income tax are made by the20th of each month;

till 25th day of each month settle VAT tax and submit JPK_V7M form. *does not apply to taxpayers settling quarterly.

until the 25th day of the month following the month in which the obligation to submit the summary VAT-EU information arose (electronic version), VAT EU shall be settled for the previous month. 

Important accounting terms - ZUS contributions

by the 10th of each month for employers who do not employ workers;

contributions for employees and for the employer of employees are paid by the15th of each month.