Turkish Business Club

Turkish Business Club

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  • Ercan ALPTÜRK
    Ercan ALPTÜRK    Premium Member   Group moderator
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    COORDINATION OF OFFICIAL-OPERATIONAL ACCOUNTING
    COORDINATION OF OFFICIAL-OPERATIONAL ACCOUNTING


    1. Subjects of the engagement

    All types of “official accounting works” and “operational accounting works” are within the coverage of this engagement. “Official accounting works” cover responsibilities determined by legislation, including the responsibility of having tax and social insurance returns signed by a public accountant. “Operational accounting works” are such kind of works explained in the following paragraph. List of official accounting works is identical in almost all entities. List of operational accounting works is determined by the peculiar conditions(1) of each entity.

    Operational accounting: The term is used to describe those accounting principles and procedures which are not imposed by legislation but put into effect by the management for the purpose of facilitating financial management and conduct of operations. For example; (a) Using, for various reasons(2), some sub accounts, although using determined main accounts is sufficient to meet the official conditions. (b) Preparation of financial statements(3) for periods shorter than a quarter, although quarterly financial statements are sufficient to meet official conditions. (c) Preparation of financial statements which incorporates more detail(4) than officially required. (d) Preparation of financial reports(5) other than official financial statements.

    This engagement, naturally, includes our “tax and other financial legislation consultancy” engagement to a great extent.

    2. Our studies within the engagement:

    First of all, we develop our recommendation concerning “the most convenient list of operational accounting works” for our clients, and make said list definite by receiving our clients’ approval throughout discussions with them.

    In connection with the works on said list, we conduct studies, depending on the choice of our clients, ranging from “monitoring and giving direction to these works” to “execution of these works” including establishment of necessary systems.

    3. Enhanced engagement [a DEFINITE SOLUTION service package]

    We provide our clients with a service package which includes subjects and studies within the context of this engagement together with some or all of the subjects and studies within our “financial management consultancy” engagement.


    Footnotes:
    (1) Features of the industry and business, management philosophy, size, organization structure, etc.
    (2) For example; comparison of planned performance with actual results, preparation of reports said in footnotes 4-5.
    (3) Main financial statements: balance sheet, income statement; Other financial statements: statement of cost of sales, funds statement, statement of profit appropriation, statement of changes in equity.
    (4) For example; preparation of balance sheet as to show currency positions, preparation of income statement for departments, etc.
    (5) For example; reports showing the breakdown of receivables and payables as to maturity dates, customer profitability reports, product or service profitability reports, etc.
    • 24 Nov 2010, 10:01 pm