When is accounting restoration required:
- If book-keeping is in poor condition, when 20% of the business activity is not reflected in accounting or reflected incorrectly. In this case, restoration will be more efficient, than conducting an audit and correcting the books at the end of it.
- Failure to submit declarations and pay taxes, which may lead to a seizure of bank accounts.
Goals and results of accounting restoration.
Possible goals for accounting restoration:
- Avoiding problems with tax inspection and having proper tax calculations.
Tax inspectors will check if property, income and costs were accounted for accurately and these accounting objects were confirmed by primary documents, also if books match tax declaration details. That is why we have to check and restore documents during accounting restoration, often having to create book-keeping from scratch, recalculate taxes and submit revised tax declarations.
As a result of restoration bookkeeping should be ready for tax inspection, while taxes and tax risks — minimized.
- Receipt of positive auditor's conclusion for the restored period.
When it comes to a sale of company, bank loans/ other investments, bankruptcy, provision of statements for proprietors, one requires an auditor's conclusion to prove that all of the statements are authentic.
Once restored, the books should accurately reflect all business transactions in compliance with legal accounting requirements.
- Avoiding seizure of bank accounts.
When there is an obvious threat of a bank account attachment, one should immediately start the process of recovering accounting records, submit primary and revised declarations and pay taxes.
- Creating an accounting structure for future use of an enterprise.
During the process of accounting recovery we create a specific accounting system. Our IT department makes every effort to maximize accounting program automation, thus minimizing accounting restoration costs.
The result of recovery of accounting records is well established automated accounting, which will provide you with information for business development and reduce the costs.
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Why one may require accounting restoration.
Accounting restoration issues often arise in the process of business activities of any level. The reality of business activity in Russia suggests that in most cases accounting costs are not the top-priority, as a consequence companies hire low-level accountants, do not wish to pay for accounting control (audit) and its automation. This is quite understandable and explainable. Any business survives on condition that production relations correlate with production development level. This is the main law of economy for some reason ignored in our country. As a result, a small enterprise with 3-4 employees is not only incapable of paying unreasonable taxes, but also can't afford to divert means for a bulky accounting with all of its methodological routines.
Accounting itself is important rather for managerial tasks which are essential when there is an adequate business development i.e. an adequate development level of production relations. If an enterprise with a specific legal entity has reached the development level, however prior to that, bookkeeping had not been done properly, and it's inappropriate to change the legal entity, restoration of accounting becomes inevitable. It's interesting to notice that restoration of accounting (if it's still possible) is often cheaper, than monthly accounting costs (it's cheaper in terms of recalculated taxes as well). When You start wondering, if You paid too much for restoration services, remember how much you have saved on not having to keep books (of course, we know many sad examples when an accountants on big salaries totally neglected book-keeping while overpaying significant amounts in taxes).
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