Why It Is Necessary To Adopt Double Entry System Rather Than Single Entry System For A Small Businesses / Entrepreneur
Double Entry System Is Better Than Single Entry System We already studied about Double Entry Bookkeeping System And Single Entry System in our previous blog posts. After making comparison between these two Systems, we are now in a position to find the reasons why it is important for businesses, especially, for Small And Medium Enterprises (SMEs) to follow Double Entry System rather than weak and improper Single Entry System for Bookkeeping and Accounting Records. 1. The First Reason is that Single Entry System lacks necessary and important information i.e., in case of Cash Sales Business Transactions, which are taken place on daily routine line basis, and hence there may be lots of mistakes and errors and frauds while recording accounting data. So Proper Books of Accounts is necessary for running the business successfully. 2. Many mistakes, errors and frauds destroys the business and ultimately the small business need to close due to lack ...