Chapter one

Introduction
1.01 Introduction

The internship report was made after having done the internship from the CA Reddy & Co
particularly in accounting department from 13/3/2024 to 10/4/2024,

This chapter contains the following background of the internship; background of the study selected
and background of the organization: location : mission : vision : organization structure and other
services & main activities carried out by the organization.

1.1 Objectives of the internship

 Students gain knowledge about particular aspects and functioning of the organization with a
special Emphasis on finance/accounting & marketing management in public administration,
private sector, non government organization and self employment & others
 Students knowledge about practically performing specific task and developing program
identification and problem solving skill in finance/accounting management
 Gain the early understanding and appreciation of the practical life real-life situation and
challenges associated with application of the theoretical knowledge acquired
 Develop and acquire skills needed to proactively observe and analyze problems/ challenges
encountered while executive career duties and responsibility at work

1.2 Scope of internship

The internship aimed at providing the students necessary knowledge and skill line with the field of
accounting and financing, the intern intended to provide quick response to the public and as well
market the activities of the organization .

This enable the students to generate practical skills from the respondents in the various directorate
and department of organization

1.2.0 Accounting:

An accounting practice is intended to enforce a firms accounting guideline and

policies . It exits as the daily recording of the financial data that is important to the evaluation
and monitoring of the firms economic activities. Accounting practices refers to the normal,
practical application of accounting and/or auditing policies that occurs within a business.
Well- maintained and balanced accounting records are one of the vital parts of a business
whether it is large or small, a start-up, or a long-standing, business. When things are financially
unstable, good accounting records can provide answers as to what change to make or what to
do away with in order to keep business growing and prospering.
In order to keep good business accounting records. We need to have a good accounting
program and the knowledge to keep it well-organized and up-to-date. Everyday accounting and
financial information will need to be processed and reviewed in order to achieve goals and
to be to predict future finances. Knowing where money is spent and how it is possible to
reduce costs are some of the most important topics in starting and making business grow.

A company`s accounts records held on accounts ledger, give a detailed description about
profit s and loses in a cash spreadsheet and integrity of the business. Auditors can study these
financial statement and determine the accuracy and integrity of the business. An accounting
statement also distinguishes the success ratio of present from past progress using accounts
formats that are recognized by other companies and bodies.

Bank may want to see balance sheets and profits and loss statement before given a loan.
Every business owner must realize that proper and accurate bookkeeping is one of the
most important parts of the business. May believe that starting a business is the way to
get ahead. However, without proper accounting records business is much less likely to
survive.

Above all else, it is important to make sure that records are an accurate reflection of
business and that they are maintained on a regular basis. Keeping records regularly up-to-
date is much easier than trying to remember weeks or months later the details of
transaction.

FIGURE 1.1 STANDARD ACCOUNTING CYCLE

Identification & measurement of
transaction & other events

Closing Journalization

Financial statement preparation Posting

Trial balance preparation

Adjusted trial balance

Adjustments
 Identification business transaction is first step in “accounting”. The transactions are recorded
in the subsidiary books & journal proper , with the help of those books we prepare ledgers
a/c`s , The balance show by ledger a/c`s are used for preparing trial balances, which serves as
the basis for preparation of financial statements, financial classification as income statement
& posting statement.

Finally posting statement ( balance sheet ) is prepared which reflects the true position of asset
& liabilities of the business

1.2.1 Definition of accounting

1941 the American institute of certified public accounts ( AICPA ) defined accounting as :
“The arts of recording, classifying and summarizing in a significant manner and in term of
money transactions and events, which are in part, at least, of a financial character and
interpreting the result there of ’’

1.2.2 GOLDEN RULES OF ACCOUNTING

I. For personal accounts = Debit the receiver

Credit the giver

II. For real or property accounts = Debit what comes in

Credit what goes out

III. For normal accounts = Debit all the expenses

& losses

Credit all the gains &

incomes

1.2.3 THE FIVE CATEGORIES OF ACCOUNTS

American accounts have developed and classified the accounts into 5 categories and
have bought out 5 set of rules for debit & credit
  Asset : Debit increases an asset

Credit decreases an asset

 Liabilities: Debit decreases a liability

Credit increases a liability

 Capital: Debit decreases capital

Credit increases capital

 Income & gains: Debit decreases an income

Credit increases an income

 Expenses & gains: Debit increases an expenditure

Credit decreases an expenditure

1.2.4 Branches of accounting

Accounting has at present three sub field or branches of accounting

1.Financial accounting :

Accounting is a wider and comprehensive concept. It is an art of identifying, classifying,

recording, summarizing and interpreting business transaction of finance in nature .

Accounting is such book keeping plus preparation of financial statements reporting the results of
the business and interpreting the accounting into funds and cash flow statements schedules charts
& diagrams
2. Cost accounting:

It deals with cost of production and its various constituents. It is concerned with the
classification allocation recording summarizing and reporting current and prospective costs, cost
accounting is the systematic process of determining unit cost all different level of production.

3. Management accounting :

Management in the business is concerned with decision making in the business is

concerned with decision making for the efficient working of the enterprise so management
accounting is a system to assemble and furnish the useful material and summarized accounting info
to the management. Management accounting as such is the effective blending of financial & cost
accounting together with financial management the ultimate end of management is maximize profit
at the minimum cost & sacrifice.

1.2.5 Objective of accounting

 Maintaining proper records of business

 Calculation of profit or loss
 Depreciation of the financial position
 Providing effective control over the business
 Making information available to various groups

1.2.6 Advantages of accounting

 Helps management: it enables the management to assess the achievement of its performance.
Actual performance can be compared with the desired performance can be compared with
the desired performance or with the performance of previous years
 Facilitating the sale of the business : the position statement of the business shows the
value of assets & liabilities of the business
 Realization of debts : personal ledger accounts of all the parties are prepared while
accounting the personal account shows the exact amount due from the debtors
 Preventing and detecting frauds: the proper accounting system and effective arrangement of
internal check prevents leakage of goods & cash
 Replacing memory : accounting records these transaction in writing and thus it is not
necessary that the businessman should memorize all the transaction
 Performance evaluation of the business: accounting keeps proper & systematic record of all
business transactions
  Assessing the financial position of the business
 Documentary evidence

1.2.7 Limitations of accounting

 Incomplete information : accounting records only those transaction which are financial in
nature transactions of non-financial nature do not find place in accounting, though they
affect the financial soundness of business
 Information may not be exact: accounting assesses profit or loss of the business on the
basis of both the real and assumed estimates. Different firms have their own different
methods so the result of the business will change with the change in practice
 Irrelevant assets : there are certain assets which do not have relevance but they are shown
in our balance sheet. Showing these assets in the books of accounts makes its result
doubtful.
 Manipulation :accounting results are based upon the information supplied to it accountants
can show the result of business as desired by the owner of the business
 Present value of business : the value of assets shown in the balance sheet are at its book
value not at the market value, accounting in this way fails to show the present value of the
business

1.3.0 Organization Profile

1.3.1 background of the organization

CA Reddy & Co. is a leading auditing and tax consultant firm. It was started in the year 1988. Its
is provides the service of auditing and income tax filling, filing of sale tax, assessment of ITR ,
ITR filling, GST return, also filling of appeals and hearing the assessment and appeal and also
attending the income tax scrutiny assessment .

It is a professional managed firm. The consist of charted accountants , tax consultants , the firm
represent a combination of specialized skills and professional skills, which are geared offer the
financial advice and personalized service. They are associated with the firm have regular
interaction with industry and other professionals which enables the firm to keep the pace with
contemporary developments and to meet the needs and satisfaction of the clients

CA Reddy & Co is rendering services from the last 40 years like maintaining the books of
accounts , purchase registration, sales registration, cash book and ledger, stock register and prteparing
the profit and loss accounts , balance sheet

There are nearly 150 companies GST filling and 500 plus files under income tax

The firm has a clear vision of its future and growth and development of auditing and accountings
services to stay ahead of these trends and developments as to assist clients in their business
operations and growth.

1.3.2 Location :

CA Reddy & Co is located in - #2908 4 th “A” Cross, B.S.K. 2nd Stage, 2908, 14th A cross Rd,
siddanna layout, Banashankari stage 2, Bengaluru Karnataka 560070

1.3.3 Mission

Our mission is to develop strong professional relationships We take a genuine interest in

our clients and strive to understand the intricacies of their business. We work hard to
provide highest quality of services on a timely, effective, and efficient basis, while maintaining
the highest standards of professional integrity Our work environment consists of providing
professional challenge s to our employees , fulfilling their careers, and giving them opportunities
for financial rewards. We try to foster an enjoyable working environment, based on open
communication , mutual respect, and encouraging proactivity, innovation teamwork, and loyalty
We work to achieve profitable growth and long term financial success for the present and
future generations.

1.3.4 Vission

Our vision is to become a leading firm in delivering value consistently to the clients. We
believe in the concept of shared vision. The acceptance of our vision by the clients and
employees, along with other stakeholders is what we strive for. For us client satisfaction is
foremost and hence we strive to help them in achieving sustainable growth and prosperity.
To maintain this relationship we endeavour to create a high level of trust and mutual
respect with the clients. Our aim is to be acknowledged as the most proactive, forward
thinking and helpful firm in India. Providing the best services by employing the best team
is the key strategy we have . For this we try to keep our human resource highly
motivated by providing them with an enjoyable working environment along with
opportunities and challenges which help them to prove their mettle. We follow a strategy
of dynamic response to the environmental changes. This helps our clients to stay updated
in order t o tackle the latest developments in the environment.

1.3.5 Gender in the organization

The company have over 15 employees, figure 1.2 illustrates that 20% are female employees while
80% are males.

FIGURE 1.2 SHOWING EMPLOYEES BY SEX

80%

70%

60%

50%

40%

30%

20%

10%

0%
female male

1.3.6 Organizational Structure :

 Audit and assurance :

Firm provides audit service to wide range clients with include performing audit of financial
statement of limited companies, NGOs and partnership, firm also performs special assignment
which include management audits, internal audits and investigations. Audit focuses on
business issued and the matters that can impact on the financial statements, whilst also
retaining the basic audit procedures that test the information contained in the financial
statement . In doing so firm not only identify the non-compliances but also assists clients in
its rectification, designing remedial measures and provides guidance with the law and
regulations. Firm always endeavour to meet reporting deadlines as set out by the laws and
regulations or as mutually agreed with clients, without compromising the professional, legal
and ethical requirements.

Firm emphasis on delivering high quality services to clients, adding value to their business
through identification of existing and potential control risks and suggesting best possible
measures in the given circumstances. Firm always place priority in deploying audit teams to
clients who are all well equipped with the specific industry knowledge, experience and are
professionally sound.

 Direct, Excise ,and Service tax :

Firm delivers taxation service to clients and assists them in obtaining optional tax
benefits available under the laws. Firm also assits clients to comply with the tax
rules and regulations and always keep them updated with the latest development
and amendments. Tax personnel are qualified professionals, experienced and
knowledgeable. We maintain a comprehensive tax library which always provides
 ready references and timely solution in complex situations . Firm provides a
comprehensive range of tax services which includes;
i. Preparation and submission of annual tax returns
ii. Compliance services
iii. Tax advisory services
iv. Representation and litigation with tax authorities
v. Personal income tax services
 Computer department :

department handles the computer related matters and assits other departments in
working properly and efficiently. Departments deals with online filing of returns of
income for tax department and finalize audit reports in proper format in a
presentable manner. It deals with networking of computers in office and all other
problems which may be faced by computer users time to time
 H R Department :

this department is mainly concerned with recruitment hiring/firing of the firm and this
department presents the timely. Reports on effective utilization of the resources by firm. A
purposed of human resources is to keep the trained employees and recruit new staff to
wok. Another purpose of this department is to provide a good working environment for
staff and try to make by facilitating them and arranging some recreational activities for
them. He knows the real worth of its employee and motivate them to work efficiently and
diligently.

 Company Secretarial service

it Is must for all companies to have their statutory files maintained by qualified company
secretary as well as to prepare and submit annual return on time to the company
commission. His service includes draft all necessary notices, act as nominee directors and
advising clients regarding company secretarial matters

FIGIURE 1.3 ORGANIZATION STRUCTURE

CEO

DIRECTOR

Audit and Direct, Computer HR Company

assurance Excise, and department Departmen Secretarial
Service tax t services

1.3.7 Objectives of the company

 Financial stability and profitability: companies main aim is to generate

profits and financial success to sustain operations, by providing higher level
of service to their clients and streamlining their operations.
 Growth and expansion : many companies strive to expand market presence
increases their customer base and explore new opportunities to for growth and
expansion of the company.

 Customer satisfaction : companies focus on providing high-quality services that

meets customers needs and exceed their expectations

 Employee satisfaction and development : companies often prioritize the

development and well-being of their employees, providing training, career
growth opportunities and positive work environment to work more comfortably
and effectively.
  Social responsibility and sustainability : many companies also aim to make a
positive impact on society and the environment through there own initiatives
such as sustainability practices , community involvement and ethical business
operations.

1.3.8 Services rendered by the organization

 Direct tax services

 Filling of Income Tax Returns of Corporate and Non
Corporate clients
 Tax Compliances which includes, Income Tax Assessments,
Appeals before Commissioner (Appeals) and Income Appellate
 Filling of TDS Returns
 All other matters related to TDS and Income Tax Matter
 Dividend Distribution and calculation of Dividend Direct Tax
 Calculation of AMT / MAT
 Compliance with Transfer Pricing Regulations including documentation
 Transfer Pricing Audit
 Representation before Transfer Pricing Authorities
 Providing consultancy on various intricate matters pertaining to Income tax
  Helping the clients through effective tax management tax structuring and
advisory services
 Advance tax estimation and deposit there by aiding the Clients to comply with
the legal provisions
 Keeping the client abreast with the updates brought about
by amendments, circulars, notification s & judgments
 Filing Income Tax returns for all kinds of assesses whether individual, BOI ,
AOP, firm or company etc
 Assessing the liability towards deferred taxes
 Filing Income Tax returns for all kinds of assesses whether individual, BOI ,
AOP, firm or company etc
 Filing Income tax returns for employees of corporate clients
 Employee compensation structuring to minimize tax burden and provide the
client with a competitive advantage
 Employee tax and statutory compliance assistance to ensure minimum
interference from revenue authorities
 Helping to frame proper policies for Employee incentives (including equity
incentive/share plan)
 Liaison with Income tax department for rectification , assessment, obtaining
refunds etc
 Expertise in complicated direct tax assessments and scrutiny matters
 Advice on future tax implications in respect of the potential acquisition
 Optimum use of corporate tax incentives in proposed business activities so
as to minimize cost and improve the margin
 Tax-planning strategies and helping resolve uncertain tax positions

 Indirect tax service :

 GST Migration Procedure
 GST Impact Analysis
 Pricing Structure
 Consultation in Transition Period
 GST Implementation
 GST Compliances
 Filling of GST Returns
 GST Audit
  Filling of Monthly , Quarterly and Annual Returns under GVAT
 VAT Audit
 VAT Assessment
 Service Tax Assessment

 Advisory service
 Preparing business plans
 Budget and Forecast
 Conduct a feasibility study of the project
 Prepare a project report along with liaison with Bank
 Preparing application and arranging Term loan with Bank
 Design, Implementation and Review of Accounting manuals
 Advice on various accounting and accounting standard issues Including IFRS
 Consultation and Advice in matters relating to Business set up And Business
structuring of foreign clients
 Share Valuation
 Corporate Restructuring
 Consultation for Public Issue Matters
 Consultation for Private Equity matters
 Personal financial investment planning and family settlement issues
 Wills and Partnership Deeds
 Certification
 All the advisory in relation to Income tax, VAT, Service Tax, GST,
International Taxation
 Advisory in the Company Law Matters.

 Secretarial :
 Formation of Indian Private / Public / Section 8 Companies / 100% subsidiary /
Branch office / Liaison Office
 Drafting Memorandum and Article of Association of Company Conversion
from Private to Public Limited Company and Company into LLP and vice
versa
 Filling of various Returns with ROC
 Filling of Annual Return in XBRL environment of the company
 Conversion from firm to company
 Consultation on Buyback of Shares
  Formation of LLP
 Drafting of LLP Agreement
 Conversion of firm into LLP and vice versa
 Modification in LLP
 Filling Annual Return of LLP
 Exit from LLP

 Book Keeping services :

 In-house accounting, compliant with local accounting acts
 Financial statements, compliant with local accounting Acts
 Management reports
 Filing of Statutory Returns
 Accounting supervision
 Accounting record review for past reporting periods
 Tax accounting and compliance (income tax, indirect tax and others)
 Preparation of MIS Reports

 Corporate services :
 Incorporation of company
 Preparing, maintaining, and consulting on the following
o AOA & MOA
o Statutory registers and records
o Policies and structures
o Directors report
o Appointment and remuneration of Directors
o Appointment of KMPs
o Preparation of Boards’ report
o CSR policy
o Related party transactions
 Registration of partnership firm including limited liability partnership
(LLP), society and trust
 Statutory compliance for formation , maintenance and winding up of
company.
 Consultancy on Company Law matters.
  Restructuring of the capital structure of the entity including increase of
authorized share capital, reduction of share capital, issue and allotment
of shares.
 Advice on the full range of strategic transactions, including mergers,
de-mergers, buy-outs, joint ventures, strategic alliances and other
restructurings
 Filing of annual returns and various forms, documents.
 Registration of companies as a Non-banking Financial Companies under
the Reserve Bank of India Act.
 Secretarial Matters including share transfers
 Fulfilling all legal requirements for Buyback of shares and on the issue of
public / rights/ bonus shares
 Maintenance of statutory Books and records, conducting Board/General
Meetings, drafting of resolutions and minutes of Board and General Body
meetings, etc
 Change of Name, Objects, Registered Office, etc.
 Representation before the Registrar of Companies, Regional Directors,
Company Law Board, Reserve Bank of India etc

 Audit services :
 Performing Risk Assessment Procedures to identify the risk of material
misstatement.
 Designing other audit procedures as per the results of such risk
assessment procedures
 Performing compliance procedures to examine the design, consistency and
operating effectiveness of the internal control system
 Performing compliance procedures to examine the design, consistency and
operating effectiveness of the internal control system
 Providing suggestions for improvement and strengthening of the controls
 Performing substantive procedures to examine the completeness,
accuracy, occurrence and validity of the transactions and the balances.
 Ensuring compliance with policies, procedures and statutes.
 Comprehensive review to ensure that the accounts are prepared in
accordance with Generally Accepted Accounting Principles and
applicable Accounting Standards / IFRS.
 Checking the genuineness of the expenses and incomes booked in
accounts.
  Checking the ownership, existence, valuation and controls over the assets
of the entity
 Reporting inefficiencies at any operational level.
 Detection and prevention of leakages of income and suggesting
corrective measures to prevent recurrence.
 Performing substantive analytical review procedures by using various
ratios, trends and other statistical tools and examining any significant
changes thereon
 Certification of the books of account being in agreement with the
Balance Sheet and Profit and Loss Account.
 Issue of Audit Reports under various laws.

 Types of Audit conducted ;

 Statutory audit of most types of entities.
 Internal Audit
 Concurrent Audit to help the clients in early detection of misstatements
and timely completion of audit work.
 Special Audi t of N.B.F.C (Under R.B.I)
 Revenue / Inspection / Stock Audit
 Operation / Management Audit
 VAT Audit under the local VAT laws
 Tax Audit under Section 44AB of the Income Tax Act, 1961.
 Audit under other sections of the Income Tax Act, 1961 such as 80HHC,
80-IA , etc.
 Revenue Audit of Banks.
 Branch Audits of Banks.
 Audi t of PF Trusts, Charitable Trusts , Schools, etc.
 Audit of Co-operative Societies.
 Information System Audit
 Our clientele :
 Manufacturing
 Trading
 Insurance
 Agriculture
 Garments
 Entertainment
  Power Sector
 Information Technology
 Government Sector
 Banking
 Infrastructure
 Chemical and Pigments
 Jewellery
 Share Broking
 NBFC
 Listed Companies

1.3.9 SWOT Analysis:

As per Wikipedia SWOT analysis (alternatively SWOT matrix) is an acronym for
strengths, weaknesses, opportunities, and threats and is a structured planning method that
evaluates those four elements of an organization, project or business venture. A SWOT
analysis can be carried out for a company, product, place, industry, or person.
It involves scanning of the internal and external environment is an important part of the
strategic planning process. Environmental factors internal to the firm or country usually can
be classified as strengths (S) or weaknesses (W), and those external to the firm or Country
can be classified as opportunities (O) or threats (T). Such an analysis of the strategic
environment is referred to as a SWOT analysis.

 Strengths :

 Adaptability and adoption of technology and availability of a wide range of systems

and software.
 A dedication to training staff. All successful firms hire out of school and grow what
they need.
 A great reputation of trust, integrity and competence.
 Our clients and the general public right fully consider us as being smart.
 Many of us are looked at as thought leaders and our opinions are sought out and
listened to.
 We have strong professional associations and societies that promote the profession and
keep track of legislation that might hurt us.
 We have a “franchise” to audit financial statements and do attestation functions.
 The larger firms, i.e., the Top 100, have become more corporate with centralized and
professional management. This is a model that can be emulated by smaller firms,
even those with a dozen people.
 As a profession, we are relatively free of debt.
 The larger firms have been set up to work virtually for many years. The smaller
firms adapted quickly (in some cases in a day) when forced to and were good enough
with virtual services, which have become pretty standard and are a testament to our
adaptability.
 We run profitable businesses with a good percentage of repetitive services providing
a sustainable cash flow (this could also be a weakness since losses usually spur
change more than profits).
 Longevity of clients and client base and high client loyalty.
 Key employees with low turnover.
 Strong firm cultures
 Team work is pretty seamless.
 Our systems all work, and even the bad systems are effective (up to a point).
 Open relationships with clients, some of whom are top-level industry leaders.
 Virtual employee training.
 Some firms have monetized websites where business is obtained.
 Accounting firms are learning organizations.
 Solid capital structure.
 A ready supply of buyers that maintain the asset values of the practices.
 We are generally available to our clients on short notice.

 Weaknesses :
 The culture of many firms thwarts the majority of personnel from becoming aware
of the many advisory services their firm offers and how staff could spot
opportunities.
 Technical and systems training that enables staff to get working productively
pretty quickly , but is not designed to teach them how to be innovative and to seek
out opportunities with clients or within the firm.
 Minimal soft skills training.
 Competition on a majority of the standardized services we provide tends to reduce
fees.
 The inability of many partners “selling” a prospect to present the full value the
firm will provide, so the sale becomes that for a commodity.
 A lack of in-house professional business development people that can be brought on
sales calls.
 Many partners resist necessary training in new endeavors , procedures and new
technology.
 Firms’ infrastructures are based on an old model with higher or now
unnecessary costs.
 New system setups at many firms are executed “perfectly” but are not being
carried through to full implementation.
 Office facilities are on a pat h to be downsized over remaining lease terms,
costing substantial amounts that could have been saved.
 If the firm is a niche provider in very few industries and those industries have
a melt down , the firm could lose a substantial source of its revenue.
 Building up the skill levels of staff to support partners and services and then
not promoting them because they do not generate new business.
 Partner compensation mired in old-school models.
 Inability of many older partners to authorize or permit investments in new and
innovative services and infrastructure strengthening.
 Lack of diversity of staff and also of the client base.
 Some firms have very high employee turnover, an older management base, are not
learning organizations, and have no partner energy or synergy.
 The opposite of any strengths listed in that section.

 Opportunities :
 To be able to not only grow with our clients but in many cases to lead clients’
growth.
  The need for advisory services is expanding very rapidly and many of the
innovative firms are jumping on these opportunities.
 The accountant usually finds out early on about personal or professional services
that a client needs, enabling us to enter that space.
 The colleges provide a steady stream of entry-level personnel and, as we add
services, we can draw the people we need from the colleges (a threat could be a
declining number of students enrolled in accounting programs).
 Business transparency is increasingly becoming more important, and that means
added services for independent accountants.
 AI and robotics and other technological methods are rapidly growing and some of
our societies are leading and supporting this growth.
 Globalization.

 Threats :
 Many innovative premium advisory services will become commoditized, putting
pressure on pricing those services.
 It is becoming easier for other service companies, particularly niche providers, to
offer advisory services to our clients.
 Much of our value is based on reputation, and a single inappropriate action by a
partner could destroy that reputation and a firm’s value.
 Inattention by partners could cause the loss of clients or key staff.
 Swift, more frequent and wide range of tax changes.
 Government regulations.
 Negative publicity of other accounting firms’ shortcomings or errors.
 Fear of change by older partners who are complacent and risk averse, and who
dominate many practices.

1.3.10 Contribution for economic development :

 Financial expertise : Auditing Company provides financial expertise and services,
including auditing, accounting, and financial consulting. This helps business make
informed decisions and ensures financial transparency and accountability.
 Business growth : by providing advice and financial planning, Auditing companies
help businesses grow and expand. They assist in identifying growth opportunities,
managing risks, and optimizing financial resources.
 Job creation : As Auditing companies grow, they create employment opportunities,
both within their own organization and through the businesses they support. This
contributes to reducing unemployment and improving the overall economy.
  Compliance and regulation : Auditing companies ensure businesses comply with
legal and regulatory requirements. They help navigate complex tax laws, financial
reporting standards, and other regulations, promoting a fair and transparent business
environment.
 Investor confidence : Auditing companies play a crucial role in maintaining
investor confidence. By conducting audits and providing accurate financial
information, they help attract investments, both domestic and foreign, which
stimulates economic growth.
 Economic stability : Auditing companies assist in risk management and financial
planning, contributing to economic stability. Their expertise helps businesses navigate
economic challenges, ensuring continuing and sustainability.
 Skills development : Companies provide training and development opportunities,
enhancing the skills and capabilities of the workforce.
 Tax revenue : companies generate tax revenue which can be used for public
services and infrastructure and development.
1.3.11 Challenges for the company :
 Evolving regulatory environment : The regulatory landscape is constantly changing,
with new laws, accounting standards, and reporting requirements being introduced
regularly. Auditing companies must stay updated and adapt to these changes to
ensure compliance and provide accurate financial information .
 Technological Advancements : with the rapid advancement of technology, Auditing
companies face the challenges of keeping up with digital transformation. They need
to embrace new tools, software, and platforms to enhance their efficiency, data
management, and client service.
 Talent acquisition and retention : Finding and retaining skilled professionals in a
challenge for Auditing companies. The demand for qualified accountants and auditors
often exceeds the supply, lending to intense competition for talent. Retaining
experienced staff is also crucial, as their expertise and knowledge are valuable
assets.
 Cyber security Risk : As Auditing companies handle sensitive financial information,
they are vulnerable to cyber threats. Protecting client data and ensuring robust cyber
security measures is a constant challenges, requiring ongoing investment in
technology and training.
 Globalization and international standards : Auditing companies operating globally
face the challengers of navigation different accounting standards, tax regulations, and
business practices across various jurisdictions. They must have a deep understanding
of international standards and adapt their services accordingly.
  Maintaining independence and ethical standards : Auditing companies must
maintain independence and adhere to strict ethical standards, they face challenges in
ensuring objectivity and avoiding conflicts of interest, especially when providing
consulting and advisory services alongside auditing.
 Changes in accounting standards : Regulatory bodies, such as the International
Financial Reporting Standards (IFRS) foundation and the Financial Accounting
Standards Board (FASB) regularly update accounting standards. Auditing companies
need to stay updated on these changes to ensure accurate financial reporting.
 Tax law revisions : tax law are subject to frequent changes, with government
updating tax regulations to adapt to economic conditions or close loopholes. Auditing
companies must stay informed about these changes and help their clients comply
with the latest tax requirements.

Design of the Study

1.4 Design of the study

1.4.1 Objectives of the study :

 Gain practical experience in applying accounting principles and practices.
 Develop skills in financial analysis, budgeting, and financial reporting.
 Learn to use accounting software and tools effectively.
 Understand the role of ethics and integrity in accounting.
 Enhance problem-solving and critical thinking abilities.
 Improve communication and teamwork skills within a professional setting.
 Gain exposure to different areas of accounting, such as tax, auditing, or management
accounting.
 Familiarize yourself with financial statements and their analysis.
 Learn about the regulatory frame work and compliance requirements in accounting.
 Gain exposure to different industries and understand how accounting practices vary.
 Develop time management and organizational skills in a professional environment.
 Enhance your attention to detail and accuracy in financial record-keeping.
 Understand the importance of internal controls and risk management in accounting.
 Learn to interpret and apply relevant accounting standards and guidelines.
 Gain exposure to real-world business scenarios and their financial implications.

1.4.2 Type of the study :

1. Identification and recording of transactions :
The primary object of accounting is to identify the financial transactions and to
record these systematically in the books of accounts. As a result, the true nature of
each and every transaction is known without much exercise of memory.
With this end in view, the transactions are primarily recorded in general and in a
special journal and later on permanently various accounts are kept in the ledger.
2. Ascertainment of results :
Every business concern is interested to know its operating results at the end of a
particular period.
The amount of profit or loss for a particular period of a business concern can be
ascertained by preparing an income statement with the help of ledger account
balances of revenue nature. Surplus or deficit of revenue for a particular period of a
non-trading concern can also be ascertained by preparing income and expenditure
account or statement.
3. Ascertainment of financial affairs :
Ascertainment of debts-liabilities, property, and assets i.e. total financial affairs of an
organization at a particular date is another important object of Accounting. Financial
affairs of concern at a particular date can be ascertained by preparing a balance
sheet. The balance sheet is the statement of assets and liabilities of concern at a
particular date.
4. Keeping accounts of cash :
Cash book is a prominent book of the books of accounts. Cash receipts and cash
payments are accounted for in this book. A number of daily cash receipts, payments,
cash in hand and cash at the bank can be known from this book. Fraud, forgery, and
misappropriation of money are reduced by keeping cash book scientifically and
accurately.
5. Control over assets and liabilities :
For running a business successfully a businessman is to acquire various assets like
land, building, machinery, etc. He is to face various debts and liabilities like
accounts payable, notes payable, loan, bank overdraft, etc. side by side with die
acquisition of assets. The actual position of these debts-liabilities, property, and assets
can be ascertained through the proper keeping of accounts.
 A businessman can take the right steps for controlling the quantity of assets
decrease and liability increase.
 If the entity is required to file any form / application / document, then it needs
to be filed in an electronic form.
  It is enhance the skill do that work in effective way it’s important for the
organization.
 Providing financial services and achieving organization goal.
 To secure employment with a reputable company, where I can utilize my
skills and business studies background to the maximum.
 A highly organized and hard-working individual looking for a responsible
position to gain practical experience.
 To make use of my interpersonal skills to achieve goals of a company that
focuses on customer satisfaction and customer experience.
1.4.3 Methodology Adopted : Primary data Type of data collection Secondary data Here, I
have used both primary and secondary data while conducting research
 Primary data : Primary data is the data collected directly by the researchers from
main sources through interviews, surveys, experiments, etc. primary data are usually
collected from the source –where the data originally originated from and are regarded
as the best kind of data in research. In this project questionnaire method for survey
is used for collection of primary data.
 Secondary data : Secondary data is the data that have been already collected by
and readily available from other sources. Such data are cheaper and more quickly
obtainable than the primary data and also may be available when primary data
cannot be obtained at all. Here, various websites, books and journals are been
referred for secondary data.
1.4.4 Statement of the problem :
 Time management : Balancing multiple assignments, deadlines, and responsibilities can
be a challenge during an internship, requiring effective time management skills.
 Software proficiency : Learning and adapting to different accounting software used
by the organization take time and require additional training.
 Ethical dilemmas : encounter situations where ethical decisions need to be made, such as
handling confidential information or addressing conflicts of interest.
 Team dynamics : Working with different personalities and collaborating with diverse
teams can present challenges in terms of communication and teamwork.
 Adapting to organizational culture : Each organization has its unique work culture,
and adjusting to new policies, procedures, and work environments can be a learning
curve.
 Limited exposure: Depending on the internship, we may not get the opportunity to
experience all aspects of accounting, limiting your exposure to certain areas.
1.4.5 Scope of the study :
 To provide consultancy and accounting services as per the procedures & rules
described in companies Act’1956.
 Changes required to be incorporated for preparation of final accounts as per the
companies Act and the guidelines of ICAI required to be followed.
 Ensuring the day to day accounting transactions of payments, receipts, sales and
purchases, other miscellaneous expenses and inventory accounting are entered in SAP
on daily basis. Working knowledge with regards to basic data entry, report generation
in SAP environment are essential.
 Preparation, maintenance and updating of Fixed Assets Register as per the Standard
Accounting Bench marks.
 To generate monthly trial balance including priced stores ledger, funds flow statement
and final accounts ( profit and loss account, Balance Sheet quarterly, Half Yearly and
annual final accounts ) along with necessary schedules as required by the Internal
Audit, Statutory Audit, Tax Audit and as per Corporate Office Guidelines.
 Evolve the costing system with the help of departmental staff and suggest the
suitable methods for setting up of standards for regular costing system.
 Analysis of Debtors and creditors on daily basis and reconciliation of the same &
inter Unit accounts on monthly basis, preparation of Bank Reconciliation on Fortnight
basis in SAP environment.
 Preparation of Half year and Annual Budget and consolidation thereof, and analysis
of variance based on actual vs budgeted and actual vs target.
 Scrutinizing all ledger accounts at regular intervals in SAP environment.
 Passing regular journal entries, making month end provisions, month end closings and
preparation of Monthly Profit and Loss account to submit the same to Corporate
Office.
 Responsible for Statutory compliance under various acts such as Companies Act,
Income Tax Act, Central Excise, Service Tax, VAT, CST etc .
 Responsible for quarterly E-TDS returns and monthly VAT returns and any other
statutory returns pertaining to Finance and Accounts, as and when required.
 Preparation and generation of Management information /reports as when required by
both local management and Corporate Office.
 Co-ordination with Internal and Statutory auditors, providing the data for audit and
addressing audit queries / observations under the guidance of GM/AM(F&A)/OFAs
related to Finance and Accounts.
 To suggest suitable methods and latest updating on mandatory requirements with
regards to Finance and Accounts and Taxation matters under various statute for
smooth functioning of Finance and Accounts department.
  Monitoring overall accounts of this Unit and suggest remedial measures wherever
lapses found.
 All books of accounts are required to be maintained on double entry system on
accrual basis in SAP environment. The firm will be required to provide the services
to ensure preparation and finalization of unit’s accounts using SAP environment. The
correctness and quality of accounts and other reports will have to be certified by the
Chartered Accountants.
 Any other works assigned by the GM/ AM (F&A) /OFAs related to Finance and
Accounts.
1.4.6 NEED OF THE STUDY
 It Helps in Evaluating the Performance of Business :
Your financial records reflect the results of operations as well as the financial
position of your small business or corporation. In other words, they help you
understand what’s going on with your business financially. Not only will clean and
up to date records help you keep track of expenses, gross margin, and possible debt,
but it will help you compare your current data with the previous accounting records
and allocate your budget appropriately.
 It Ensures Statutory Compliance :
Laws and regulations vary from state to state, but proper accounting systems and
processes will help you ensure statutory compliance when it comes to your business.
The accounting function will ensure that liabilities such as sales tax, VAT, income
tax, and pension funds, to name a few, are appropriately addressed.
 It Helps to Create Budget and Future Projections :
Budgeting and future projections can make or break a business, and your financial
records will play a crucial role when it comes to it.
Business trends and projections are based on historical financial data to keep your
operations profitable. This financial data is most appropriate when provided by well-
structured accounting processes.
 It Helps in Filing Financial Statements :
Businesses are required to file their financial statements with the Registrar of
Companies. Listed entities are required to file them with stock exchanges, as well as
for direct and indirect tax filing purposes. Needless to say, accounting plays a
critical role in all these scenarios.
1.4.7 Limitations of the study :
 Limited scope : Internships may focus on specific areas of accounting, limiting
exposure to other aspects of the field.
 Limited exposure to advanced accounting software : Internships may not provide
extensive training on complex accounting software used in the industry.
 Lack of client interaction : Interns may have limited opportunities to directly
interact with clients and gain experience in client relationship management.
 Limited exposure to international accounting standards: Internships may focus
primarily on local accounting practices, limiting exposure to global accounting
standards.
 Potential for repetitive tasks : Interns may be assigned repetitive or routine tasks,
which may not provide a comprehensive understanding of the accounting field.
 Lack of long -term commitment : Internships are temporary, so interns may not
have the opportunity to see the long-term impact of their work.
 Time constraints : Internships typically have a fixed duration, which may not allow
for in-depth learning or exploration of complex accounting topics.
 Lack of real-world complexity : Internships may not fully replicate the challenges
and complexities of real-world accounting scenarios.
 Limited responsibility : Interns may have limited decision-making authority and may
not be exposed to high-level accounting tasks.
 Limited exposure to different industries : Internships may be specific to a
particular industry, limiting exposure to accounting practices in other sectors.
Chapter 3

Discussion
3.1 Basics of accounting

Accounting is the process of recording financial transactions pertaining to a business the

accounting process includes summarizing, analyzing , and reporting these transactions to oversight
agencies regulators and tax collection entries the financial statements used in accounting are a
concise summary of financial transactions over an accounting period summarizing a company's
operations financial position and cash flows.

There are two types different basis of accounting

1. Cash basis : Cash basis is the most basic accounting. On a cash basis, you only
record transaction when money changes hands.
2. Accrual basis : In accrual basis you record transactions twice: when they occur and
when they`re paid.
 Journal : It is a detailed account that records all the financial transaction of
the business, to be used for the future reconciling of accounts and transfer of
information to other official accounting records, such as the general ledger. A
journal states the date of a transaction, which accounts were affected, and the
amounts, usually in a double-entry bookkeeping.
 Ledger : it is a book containing accounts in which the classified and
summarized information from the journals is posted as debits and credits. It is
also called the second book of entry. The ledger contains the information that
is required to prepare financial statements.
 Cash book : It is a special type of book that is only concerned with the
recording of cash transactions of an organization. It performs the dual role
both journal and a ledger for all the cash transactions taking place in a
business organization. A cash book records all the cash receipts on the debit
side and all the cash payments of the organization on the credit side.
  Petty cash book : It is for very small transactions that take place in an
organization. Such transactions can occur in a day and repetitive in nature,
which can put undue load on the general cash book. That`s why it is
maintained separately.
 Double cash book : It is an additional column that is reserved for the
discounts. Therefore, in a double-column cash book, know as two-column
cash book, the cash receipts and transactions are recorded in one column
while the second column records discount received and discounts provided.

ACCOUNTING PRACTICES :

The accounting practices and the underlining accounting policies of organization should follow generally
accepted accounting standards and policies. Their account should be easily understood by interested
parties. Majority of the organization may decide not to follow the normally accepted rules especially
where the cost of employing additional accounting staff would outweigh any benefit. Some of these
accounting practices have been outlined below:

1. Receipt and Handling Cash:

Procedures and responsibilities for the receipt and handling of cash are clearly defined. For
example, only the proprietor or casher is authorized to receive cash. Pre numeral receipts bearing
the names of the enterprise are issued for all cash receipts. Unusual receipt books are kept properly
and they proper procedures are regard to their issues.
2. Recording Payment:
All payment in the small-scale enterprise is supported by payment vouchers with adequate
documentations and explanation. Small and medium enterprise also has an adequate system in place
to prevent duplication of payment to suppliers and employees with payment properly allocated to
the correct account.
3. Bank Account:
Most of the bank account is authorized in the name of the owner of the business. The bank account
is also included in the account of the owner of the enterprise. Proper control over use and safe
keeping of cheques are practiced by the enterprise owners.
4. Cash Books:
Cash book are kept for all cash and bank transactions. The cash books additions and cross addition
are correct. Also, entries in the cash book are all in ink and written up to date.
5. Petty Cash:
 Records Most small business need to use petty cash money withdrawn from the bank and use it to
buy sundry items. Approved procedures are required and expenses correctly recorded in the system.
Petty cash is also known as an impress fund, whereby the fund is replenished in exactly the amount
that is taken from it. The petty cash impress (float) is established at reasonable level. Petty cash
expenses are supported by adequate documentation. The petty cash is always checked when the
cash floats are replenished.
6. Ledger:
Posting are done of amount from the cash book to the account in the ledger which are kept up to
date. Additions and postings to individual ledger accounts are done and ensured that they are
accurate and correct. An up to date chat of account together with the account reference numbers are
held by the owner of the enterprise.

7. Journal:
Transfer between one ledger account and another are recorded in the journal. Transfer of account
between one account and another account are supported by a journal voucher showing the reason
for the transfer with supporting documentation where appropriate.
8. Account Payable and Creditors:
Suitable records are maintained showing amount due to suppliers. These records are regularly
reconciled to statement and account received from suppliers.

Book keeping : Bookkeeping practice is the process of recording enterprise financial transactions to
support its financial condition. It is important in sustaining and growing any enterprise and assists them to
make sound economic decisions for future plan.

Accordingly, bookkeeping was considered as the foundation on which a compliance program should be
built upon. the bookkeeping is just as important as making enterprise. If properly maintained, bookkeeping
could lead to increased profitability and expansions of organization.

Book keeping is the recording off all financial transaction in a systematic and logical manner. Transactions
include sales, purchase income, and payments by an individual or organization. Book keeping is usually
performed by a book keeper using common methods of bookkeeping such as single entry and double entry
systems. While these systems may be seen as “real” book keeping, any process that involves recording of
financial transactions is a book keeping process.

Primary bookkeeping records all business transactions and allocates the income and expenses to various
income and expenses account in separate account records.

The single book keeping can be done with book keeping software to speed up manual calculation.

OBJECTIVES OF BOOK KEEPING

Proper Book Keeping has many objectives that it fulfils as an art of accounting procedures, hence
businesses must pay particular attention to its effectiveness and efficiency. These objectives are as follows:

 A permanent record is made of all transaction entered into by the business.

 Management have a continuous record of debtors (those who owe the business) and creditors (those
to whom the business owes).
 Management can control and safeguard the business assets be it tangible or intangible, fixed or
current assets.
 Manager(s) have information, without which management would be impossible.
 The law requires certain records – PAYE, VAT, Social Security Contribution, for all business.
Certain businesses are requiring to maintain certain specified records.

 Failure to maintain records can be an offence in bankruptcy or liquidation.

 Records are essential for the production of financial statements.

Types of Book keeping

Book keeping records are e.g. the sales day book, purchases day book, cash receipt book, cheque
payments book, petty cash book, general journal, nominal ledger, debtors’ ledger and creditors’ ledger.

Quite often a separate payroll system is maintained and payroll transactions are summarized through
general journals. However, all enterprises do not necessarily need the entire above-mentioned book
keeping records; the enterprise has to decide this on the basis of its needs.

When the enterprise makes the judgment of what book keeping records to maintain it also needs to take
into account whether some book keeping records are compulsory in the particular Member State.

1. Single Entry System:

The single-entry system is an "informal" bookkeeping system where a user of this system makes
only one entry of a business transaction. It generally includes a daily summary of cash receipts and
a monthly record of receipts and disbursements (worksheets).
The single-entry system is an "informal" bookkeeping system where a user of this system makes
only one entry of a business transaction. It generally includes a daily summary of cash receipts and
a monthly record of receipts and disbursements (worksheets).
Cheques and withdrawals are entered as expenses. If a manual system is used, in order to determine
your revenues and expenses you have to prepare worksheets to summarize your income and
categorize and summarize your different types of expenses.
Bookkeeping software and spreadsheets are also available to do this for you. The emphasis of this
system is placed on determining the profit or loss of a business. It got its name because you record
each transaction only once as either revenue (deposit) or as an expense (check).
 Since each entry is recorded only once, debits and credits (recording method required for the double
entry system) are not used to record a book keeping event. While the single-entry system may be
acceptable for tax purposes, it does not provide a business with the entire book keeping information
needed to adequately report the book keeping affairs of a business.
2. Double Entry System:
The double entry system is the standard system used by businesses and other organizations to
record book keeping transactions. Since all business transactions consist of an exchange of one
thing for another, double entry bookkeeping using debits and credits, is used to show this two-fold
effect.
Debits and credits are the device that provides the ability to record the entries twice. The double
entry system also has built-in checks and balances.

Due to the use of debits and credits, the double-entry system is self-balancing. The total of the debit
values recorded must equal the total of the credit values recorded.
This system, when used along with the accrual method of bookkeeping, is a complete book keeping
system and focuses on the income statement and balance sheet.
This system has worldwide support as the system to use by businesses for recording their book
keeping transactions. It got its name because each transaction is recorded in at least two places
using debits and credits.
Bookkeeping practices :
 Person in-charge of bookkeeping.
 Type of bookkeeping.
 Method of bookkeeping.
 Accounting method.
 Bookkeeping records.
 Frequency of record.
 Bookkeeping activities
 Bookkeeper’s role in tax compliance.

SIGNIFICANCE OF RECORD KEEPING :

 Financial Position :
It enables the management to know where the business stands financially. Without proper business
records, the business will never know what its real financial position is, but it is very useful to be
able to work out how much the business has at the bank, how much money is owed to the business
by customers and how much money the business owes to its suppliers. This can be done only if
substantial records of the business are kept.
 Decision Making :
 When proper records are kept it makes financial decisions effective. Armed with an up-to date
statement of the business’ financial position and recent 1 6 trading, management can make real
financial decisions. For instance, if there is the need to invest in more capital assets (that is, plant
and machinery), or rather employ more labor and also where to allocate scarce resources. Without
business records providing management with the necessary facts, management would not be in the
position to make such decisions.
 Auditing Purposes :
When proper records are kept, there will be no need to appoint an auditor to audit the firm
especially in the case of a sole trader or a partnership firm unless otherwise stated. However, in the
case of a limited liability company, it accounts will have to be audited each year by a qualified
auditor, who goes right through the records of the business to satisfy himself that, the accounts give
a true and fair view of the company’s financial situation and of it profit and loss for the period. The
possibility of the audit work would be depended upon the relevant, reliable, accurate and adequate
records of the firm.
 Tax Assessment :
Proper records enable assessment of tax. There must be proper records in order to agree the exact
tax liability and without good records being kept, it becomes 1 7 cumbersome to defend yourself
against excessive estimated tax demands by the tax officials or the inspector of taxes. Proper
records will enable you to know your tax reliefs and allowances that you would be entitled to and
thus would reduce your tax liabilities.
 Evidence Purpose :
It also helps to provide evidence during disputes. Whenever there is misunderstanding or disputes
arises between the firm and the other party, that is customers, suppliers or bankers, with proper
records being kept the settling of such misunderstanding or disputes would be easily solved. Proper
records would also serve as evidence in court if a legal action is taken against the firm.
 Loan Acquisition :
The keeping of effective and efficient records can assist in the acquisition of loan. Financial
institutions and other money lenders would examine critically the records of a firm to certify
whether the loan could be repaid before given it out.
 Disposal of Business Asset :
When proper records are kept, the sale of business or share of ownership can be determined. If the
owner(s) decides to sell the business, the one buying it will examine the records to know if the
business is worth its price before he purchases the business. Also, when the business wants to
introduce a partner or a person wants to join the business to share ownership, the person would
examine the records to satisfy himself if the business is lucrative to invest in or it is worth joining it.

3.2 Accounting process in tally

 How to do the accounting manually. In this we got the idea about the identification of the
transaction and also analyse them. We learned to prepare journals and ledgers also solve
some of the questions.
 We got to know about groups and ledgers dividend among the groups which are :

Groups Ledgers

Capital accounts Reserve and surplus

Share capital a/c
Partner`s capital a/c etc
Current asset Bank a/c
Cash in hand
Deposits
Stock in hand
Loans & advances

Current liabilities Duties & taxes

Provisions
Sundry creditors

Direct expenses Wages a/c

Carriage inwards a/c

Direct incomes Loans & advances

Fixed asset Building a/c

Factory a/c
Machinery a/c
Car a/c

Indirect expenses Audit fees

Depreciation a/c
Legal expenses
Advertisement a/c

Indirect income Rent received a/c

Interest received a/c
 Commission received a/c

Investment Investment in shares

Bonds
Government securities

Loans (liabilities) Secured loan

Unsecured loan

Misc. expenses (asset) Sundry debtors

Purchase account Car purchased

Machinery purchased

Sales account Any item which is sold

The following primary groups are capital in nature and appear in the balance sheet :

1. Capital Account
2. Current Account
3. Current Liabilities
4. Fixed Assets
5. Investment
6. Loans (liabilities)
7. Suspense a/c
8. Misc. expenses (asset)
9. Branch / Devisions

The following primary groups are revenue in nature and appear in the P/L account :

1. Purchase Account
2. Sales account
3. Direct expenses
4. Indirect expenses
5. Direct income
6. Indirect income

3.3 Different types of voucher

 Vouchers Types of transaction to be entered
Purchases All purchases of goods whether cash or
credit.
Entry for purchases of assets will not be
passed through purchase voucher. It will
be passed through payments or journal
voucher.
Sales All sales of goods whether cash or
credit.
Entry for sale of assets will not be
passed through sales voucher. It will be
passed through payments or journal
voucher.
Debit note When liabilities towards suppliers is to
be reduced like in case of purchase
returns.
Credit note When customers liability towards us to
be reduced like in case of purchase
returns.
Contra All transactions in which only cash and
bank accounts are involved.
Payments All cash /cheques or other modes of
payments .
Except for purchase of goods by cash /
cheque.
Receipt All cash or cheque or other modes of
receipts.
Except for sale of goods by cash /
cheque.
Journal These vouchers are used for the
following transactions:
a) Purchase of assets on credit. If
we make the payment for the
assets via cheque or cash, then we
would record the transaction in
the payment voucher instead of
the journal voucher.
 b) Sale of an asset on credit
c) Adjusting entries for outstanding
expenses and accrued incomes.
d) Depreciation entries .
Post-dated voucher Post-dated voucher is basically a
voucher that is created in advances for
payment that will happen in future.
Reversing journal voucher These are special vouchers that are
automatically reversed after a specific
date.
Memo voucher It is a non-accounting voucher. The
entries made in this voucher will not
affect the books of accounts.
They are used to remind you of a
transaction that may happen in the
future. Therefore they act references for
future transactions.

3.4 Bank reconciliation statement :

BRS is prepared on periodical basis for checking that bank related transactions are
recorded properly in the cash book`s bank column and also by the bank in their books. BRS
helps to detect errors in recording transactions and determining the exact bank balances as on a
specified date. Accounting errors could lead to circumstances that are more than just embarrassing
when the cheques bounce or companies start getting annoying calls from creditors or suppliers for
payments that are already released. Bank reconciliation assist you in spotting fraud and reducing
the risk of transactions that could cause penalties and late fees. There are some benefits of
preparing BRS which is:

 Determining errors : BRS helps in detecting errors in accounting such as addition,

subtracting, missed payment and double payment which is common in business.
 Tracking interest and fee : Banks might add interest payments, fees or penalties to your
account, monthly bank reconciliation allows you to add or subtract such amounts in your
books.
 Detecting fraud : you may not be able to prevent employees from stealing your money
once, however, you could prevent it in future. Bank reconciliation statement helps you in
detecting spotting fraudulent transactions. It is advisable to employ an independent person
 to perform the reconciliations for preventing the accounting employee from falsifying your
books and reconciliations.
 Tracking receivables : BRS allows you to confirm all your receipts, assisting you to avoid
awkward situations and also identifying entries for receipts that you don’t deposit.

3.5 Accounting software ( Tally ERP9 )

Tally is one of the integrated business management software. Tally ERP 9 is user friendly
software. It is packed with all the features that required for regular business operations.

3.6 Core Features of Tally Software :

 Simplicity : It is easy to setup and use. It requires general knowledge of Accounts

and English to use of Tally.
 Flexible Inventory Management : The software allows integration of accounting and
inventory information. For multiple product lines, unlimited groups, categories, batches
can be defined. To monitor the inventory continuously, tally facilitates the same by
providing you with analysis report. Stock movement can be tracked and item wise
profit can be seen through tally.
 Easy to Share : No internet is needed to access accounts. Software has a build
security levels data can be remotely accessed without any worry.
 Bank Reconciliation : Bank Reconciliation is another feature of Tally. ERP9.
 Remote Access : Tally. ERP 9 provides remote access from any place and anytime.
 Technical support : Timely support provide by Tally Service Partners.
 Accounting while not Codes: Tally. ERP 9 permits accounting with the regular names
with none account codes.
 Multi-lingual capability : Tally. ERP 9 allows to user multi language such as Indian
language, Arabic, English etc.
 Scalability : Its capable to any kind of business desires and eliminates the need for
a business to alter its kind of operation, so as to adapt to the appliance.

3.7 How to use Tally Software

For the use of Tally, following steps must be followed:

1. Create a company
2. Enable GST features
3. Ledger creation

Below discuss the details:

1. How to create a company?

  Go to Gateway of Tally > Alt + F3 > Create Company
 Enter the basic information, i.e., name, mailing name and address of the company,
currency symbol etc.
 In the ‘maintain field’, select Accounts Only or Accounts with Inventory as per the
company requirements.
 In the Financial Year from, the first day of the current financial year for e.g., 1-7 20178
will be displayed by default, which can be changed as per requirement.
 Enter the Tally Vault Password if required.
 Press Enter to accept and save.

2. Enabling GST features in Tally :

 Go to Gateway of Tally > F11: Features > F3: Statutory & Taxation
 In the screen you will find following options:
 Enable goods and service tax (GST): Yes, Set/alter GST Details: Yes.
 This will display another screen where you can set GST details of the company such as
the state in which company is registered, registration type, GSTIN number etc.
 Press Y or Enter to accept and save.
  Ledger Creation
After creating a company and activating GST features, you need to create ledgers that will
enable you to pass accounting entries in Tally.
Here are the following steps:
 Go to Gateway of Tally > Accounts Info > Ledgers > Create
 Enter the Name for the ledger want to create such as purchase, sales, receive etc.
 Select the appropriate group to which such ledger belongs for example state tax under duties
and taxes group.
 Enter the other related information required and press Y or Enter to accept and save.

After having done the above 3 steps, you can start entering accounting entries in Tally. For this, Go
to Gateway of Tally >Accounting Vouchers. There are many accountings Vouchers in Tally such as
Payment, Receipt, Contra, Sales, Purchase, etc. Choose the relevant Voucher and start passing the
accounting entries.
Step: 1 (Go to Account Info)

Step: 2 (Select Group/Ledgers)

Step: 3 Create Group/Ledger

3.8 vouching

Vouching is a technical term which refers to the inspection of documentary evidence supporting
and substantiating a transaction, by an auditor. It is the practice followed in an audit, with the
objective of establishing the authenticity of the transactions recorded in the primary books of
account. It essentially consist of verifying a transaction recorded in the books of account with the
relevant documentary and the authority on the basis of which the entry has been made; also
confirming that the authority on the basis of which the entry has been made ; also confirming
that the amount mentioned in the voucher has been posted to an appropriate account which would
be disclosed the nature of the transaction on its inclusion in the final statements in account.
Vouching do not include valuation. Can be described as the essence or backbone of auditing.

Voucher entry :

Tally provides flexibility to use predefined voucher types, comprising of accounting and inventory
voucher types to record various business transactions. It also allows you to use keyboard shortcut
keys as well as mouse operations during voucher entry.

Books and registers :

Tally provides you capability to generate various books and registers for any specific period viz.,
month, date, and year and as on date. In tally, once voucher entry is made, the transaction are
automatically & immediately in the day book and other books of accounts without any additional
effort. Tally allows you to maintain and generate all primary books of accounts and registers like:

 Cash book
 Bank book
 Purchase register
 Sales register
 Journal register
 Debit note registration
 Credit note registration
 General ledger

Types of Voucher

Below is the voucher, books & register of Tally software:

Receipt Voucher: To Receipt voucher records all receipt in to Bank or Cash Accounts. Such as receipt
from debtors, any income refund of loan or advance, sales of fixed assets etc.

Go to Gateway to Tally Accounting Voucher Click on F6: Receipt button presentation the
button panel to have the Receipt Voucher Creation Screen.

Payment Voucher:

Payment Vouchers records all the payments made through Bank & Cash. It is also used for payment of
fixed assets, purchase, loan & advance etc.

Go to Gateway to Tally Accounting Voucher Click on F5: Payment button presentation the
button panel to have the Payment Voucher Creation Screen.
Journal Voucher:

Journal voucher is for adjustment between any two ledgers.

Go to Gateway to Tally Accounting Voucher click on F7: Journal button presentation the
button panel to have the Journal Voucher Creation Screen.

Debit note entry :

Debit note is a document issued to a party stating that you are debiting their account in your
books of accounts for the stated reason or vise versa. It is commonly used in case of purchase
returns, escalation / De-escalation in price, any other expenses incurred by you on behalf of the
party etc.

You need to enable the failure in F11: accounting or inventory features.

  To use it in voucher mode you need to enable the feature in F11 : accounting features –
use debit / credit notes.
 To make entry in invoice mode enable the option F11 : accounting feature - use invoice
mode for debit notes.
To go to debit note entry screen,
Go to gateway of tally > accounting vouchers
 Click on Ctrl + F9 : debit note on the button bar or press Ctrl + F9.
You can toggle between voucher and invoice mode by clicking Ctrl + V
Pass an entry for the goods purchased returned to supplier A:

Credit note entry

Credit note is a document issued to a party stating that you are crediting their account in your
books of accounts for the state reason or vice versa. It is commonly used in case of sales return.

A credit note can be entered in voucher or invoice mode.

You need to enable the feature in F11: accounting or inventory features.

 To use it in voucher mode enable the feature in F11 : accounting features – use debit /
credit notes
 To make the entry in invoice mode enable the option F11 : accounting features- use
invoice mode for debit notes.
To go to credit note entry screen:
Go to gateway of tally > accounting vouchers
Click on Ctrl + 8 : credit note on the button bar or press Ctrl + F8.
You can taggle between voucher and invoice mode by clicking Ctrl + V
 Press an entity for goods sold returned from customer A:

Sales Invoice:

Go to Gateway to Tally Accounting Voucher Click on F8: Click on V (As Invoice)

Sales Invoice Creation Screen.

Sales Voucher:

Go to Gateway to Tally Accounting Voucher Click on F8: Click on V (As Voucher)

Sales Voucher Creation Screen.
Purchase Invoice:

Go to Gateway to Tally Accounting Voucher Click on F9: Click on V (As Invoice)

Z
Purchase Invoice Creation Screen.

Purchase Voucher:

Go to Gateway to Tally Accounting Voucher Click on F9: Click on V (As Voucher)

Purchase Invoice Creation Screen.
Day Book: The day book list showing all transactions made in a particular day.

Go to Gateway of Tally>Display> Daybook

Trial Balance: Trial Balance is a list of closing balances of ledger accounts on a certain date and is the
first step towards the preparation of financial statements. It is usually prepared at the end of an accounting
period to assist in the drafting of financial statements. Asset and expense accounts on the debit side of the
trial balance & liabilities, capital and income accounts on the credit side. Debit & Credit side should be
equal balance.

Go to Gateway of Tally>Display> Trial Balance

Balance Sheet : A balance sheet is a statement of the financial position of a business. which included the
assets, liabilities and owner's equity at a specific time.

Go to Gateway of Tally>Balance sheet

Profit & Loss Account: It’s a financial statement that are showing the value of summarizes the revenues,
costs and expenses that was incurred during a specified period.

Go to Gateway of Tally>Profit & Loss A/C

3.8 Overview of TDS

Tax deducted at source ( TDS ) is a tax that is deducted from income that a company in india
pays to a recepient or supplier if the income amount exceeds a specific statutory limit in a
financial year.

The types of income that are subject to TDS include:

 Salary.
 Interest and dividends.
 Winning from the lottery.
 Insurance commission
 Rent
 Fees from proffesional and tecyhnical services
 Payments to contractors and subcontractors

The withholding for TDS can be deducted from an invoice submitted by a supplier or from the
payment that is issued to the recipient or supplier. Examples of recipients and suppliers include
contractors, providers of professional sevices, employees, and real estate landlords. Compnies
submit a TDS certificate to each supplier on a monthly or yearly basis. The certificate includes
the payments, as well as information about the company and supplier. Companies must also
submit an annual return to the government for each receipts or supplier for the financial year.
TDS cetificate can be either form 16(R75110A) or from 26Q-P2P-IND (R751122EQ). from 16 is
the TDS certificate which an individual submit and form 26Q is the TDS certificate which a
company submits to the tax authorities.
TDS must also be deducted from payments issued to third parties by both corporate and
noncorporate entities. The entity must deposit the amount owed for withholding at any of the
designated branches of banks that are authorized to collect taxes on behalf of the government of
india. The entity must also submit the TDS returns, which contain details about the payments and
the challan for the tax deposited to tha income tax department (ITD).

For electronic TDS, companies must generate the form 26Q for each financial quarter. This is a
statutory requirement for the ITD

Tax deduction at source ( TDS ) & Tax collection at source ( TCS ) accounting in tally

TDS TCS
Tax deduction at source Tax collection at source
TDS is the tax which is deducted on a TCS is the tax which is collected by sellers
payment made by a company to an while selling something to buyers.
individual, in case the amount exceeds a
certain limit
TDS deduction is applicable on payments TCS deduction is applicable on sales of
such as salaries, rent, professional fees, goods like timber, scrap, minerak wood, and
brokerage, commission, etc so on
TDS is applicable only on payments that TCS is applicable on sales of specific goods
exceeds a certain amount. which don’t include production or
manufacturing material.
Ex Mr.A works at a company. His company Ex Mr.B is a mineral wood trader. He sells
deducts a tax on monthly salary at the some mineral wood to Mr.Z, while making
applicable rate before they make him the the sale, Mr.y collects 5 percent tax; this
final payout. The amount that is deducted in sum collected by Mr.Y from the customer
this manner is TDS is called TCS.
TDS Returns :

TDS is a systematic whereby the income tax is deducted at the time of making some payments
like rent, interest, commission etc. the person making such specified payments is responsible for
deducting the TDS and paying the balance amount to the person entitled to receive such payment.
The TDS amount deducted must be deposited to the government within the due dates specified by
the person deducting TDS. While it is commonly assumed that the TDS is applicable only on
salary income, but it is also applicable in manly other cases such as:

 Income from interest on securities and debentures.

 Income from interest other than those on securities.
 Income from dividends.
 Income from withdrawal of EPF ( before expiry of a certain period or if amount withdrawn
is beyond the limit specified )
 Payment to contractors / subcontractors / freelancers.
 Winning from horse races, lottery, crossword puzzles or any game related wins.
 Income from rendering technical or professional services.
 Income from royalty.

All income is taxable only at the end of the financial year , hence the government has instituted
the concept of TDS, in order to ensure:

 Prevention of tax evasion : this mechanism ensures that the government collects a portion
of the income itself, chances of hiding income or tax defaults are minimized significantly.
 Timely collection of tax
 Ease in filling tax returns : As the tax is automatically collected and deposited with the
concerned authorities by the deductor, it becomes easier for individual to file their returns.
If there are no other sources of income for a person, once TDS has been appropriately
deducted, they need not pay any additional tax during return filing.

 Process flow of TDS

This process flow shows the steps to charge and remit TDS :
 Create voucher for suppliers with
pay status % and applicable tax type

Calculate TDS on vouchers

Issue payments to suppliers with TDS

amounts deducted

Submit monthly payment for TDS to

tax authority

Update challan

Generate monthly statements and

submit quarterly and annual returns

3.9 Payroll in tally

Payroll is simply an aggregation of total amount of wages paid by the company to its
employees. It is one of the most significant expenses for business; hence it is very complicated
expenses for companies to process. Processing payroll slips is very time consuming task so
company usually hire payroll service from third parties so that it can be prepared weekly, semi-
monthly depending upon the resources which the company has in its reserve.

The payroll module in tally reports comprehensively at it has user defined classification and sub
classifications. This might be associated with the employees, employee group, pay components,
departments etc. the payroll module also lets flexible and user defined criteria for users. It offers
the facility to create user defined earnings and deductions pay heads. The module lets us use
unlimited grouping of payroll masters. Supports production/attendance/time-based remuneration units
which are user defined production units. It offers all-inclusive cost centre as well as employee
wise costing reports. Ensures timely and precise processing of salary along with employee statutory
deduction and employer statutory contributions with the help of predefined processes. It helps
generate statutory forms and challans for EPF & ESI as prescribed. The payroll module helps in
tracking the loan details of employees as well.

3.10 accounting tally

GST is an indirect tax which has replaced many indirect taxes in India. The Goods and Service
Tax Act was passed in the parliament on 29 th march 2017. The Act came into effect on 1 st july
2017; Goods & service tax Law in India is a comprehensive, multi- stage destination-based tax
that is levied on every value addition. Goods and Service Tax ( GST ) is an indirect tax levied on
the supply of goods and service. This law has replaced many indirect tax laws that previously
existed in India.

There are 3 types of GST

 CGST – Central GST-Applies to sales within the state – goes to Central Government.
 SGST- State GST – Applies to sales within the state – goes to State Government.
 IGST - Integrated GST - Applies to sales outside the state - goes to Central Government.

If we sell any goods within states, 50% of the GST will be SGST which means it`ll go the state
government. But if we sell the same goods outside the state, 100% of the GST will be IGST
which will go central government.

Tally is the most popular and reliable GST ready accounting software amongst businesses in India.
It ensures you generate GST invoices and transactions as per the GST format. We can also
manage advance receipts, revenue charges scenarios, branch transfers, bill of supply, export
invoices, input tax credit and other adjustment - all by using tally`s GST billing software. It
ensures that your GST return are in sync with your books of accounts, and reflect the same
data as used for filling returns in the GST portal, thus providing to be the right GST return
software for you. We can also file GST return accurately.

Data extraction from tally

In this module, we come to know about how to extract data from tally, we learned how to

 Print important reports from tally

 Export various reports, masters etc.
 Import various masters, transaction, etc.
  Email various reports, vouchers etc.

3.11 Steps involved in Reconciliation of Bank Accounts:

Step 1: Gather account statements from every bank that is associated with the Corporate Depot,

Sales Depots, and Factories.

Step 3: Collect cash books from each sales depot and enter them into an MS Excel work sheet.

Step 2: Gathering information on check dishonor or bounce.

Step 5: Determine whether transactions were credited in the bank statement but not debited in the

cash book, and vice versa.

Step 6: Determine whether transactions were debited in the bank statement but not credited in the

cash book, and vice versa.

Step 7: Determine the change between the cash book balance and the bank statement amount.

Step 8: Complete the reconciliation process by identifying and correcting any incorrect transaction

records.

Step 9: If the inconsistencies remain, determine the cause, bring the records into agreement, and

settle by contacting the affected depot.

The BPBL bank account reconciling system is a convenient and good procedure, but it has some

key flaws, including an information gap, a lack of communication across departments, incorrect

check or document number entry, and difficulty in locating information on bounced checks.

3.12 Shortcut key

Tally shortcut key with “ ALT ’’ button

Alt + A Add voucher/to alter the column in the columnar report

Alt + E Export the report in ASCII, HTML, OR XML format

Alt + I Import statutory masters

 Alt + H Help shortcut

Alt + I Insert a voucher

Alt + M Email the report

Alt + P Print the report

Alt + F3 Select the company

Tally shortcut key with “ FUNCTION ” button

F10 Navigation between accounting reports

F11 Modify company features specific to the current company only

F12 Master configurations, which will affect all companies in the same data directory

F2 Change the date

F6 Select receipt voucher

F7 Select journal voucher

F8 Select sales voucher

F9 Select purchase voucher

F4 Contra voucher

F5 Select payment voucher. Switch between grouped and ledger-wise display

Tally shortcut key with “ CTRL ” button

Ctrl + G Select group

Ctrl + L Mark a voucher as optional or regular
Ctrl + F9 Select debit note voucher
Ctrl + Alt + B Check the company statutory details

Ctrl + Alt + C Copy the text from tally ( At creation and alternation
screens )

Ctrl + C For copy

Ctrl + V For paste
Tally shortcut key use in “inventory invoice”

Alt + F4 Purchase order voucher

Alt + F10 Physical stock

Alt + F5 Sales order invoice

Alt + F7 Stock journal / manufacturing journal

Alt + F8 Delivery note

Alt + F9 Receipt note

Esc Clear entry

3.13 Findings

Through my internship at CA Reddy & Co I got to learn a lot about corporate environment & practical
knowledge of work. This is my great opportunity to work with CA Reddy & Co accounts department, the
accounts department is well set-up. The company uses Tall software is limited to accounts use only. But
switching to customized software would give more flexibility and productivity. Customized software needs
skilled and trained professional to operate.

3.14 Conclusion

In conclusion, accounting is a systematic way of recording and reporting financial

transaction for a business or organisation. The main purpose of accounting is to financial
transaction systematically in the books of accounts and to find out the profit-loss and financial
position of a business or organisation. Besides, accounting is very important and needed for any
business business transaction. It help in recording, classifying and summarising the transaction in a
business. This enable the business to come up with well analyse financial document like balance
sheet, trial balance and many more. Hence, availability of accounting In any business transaction
ignites the business to run with efficiency, effectively and accuracy manner on all the activities
undertaken. From our assignment we are able to learn that accounting is very important that help
organization, business, government and others corporate to determine their financial right and
obligants. With a proper accounting, all company financial information is recorded and placed
into categories which can be easily accessed, summarizing and evaluate.
 Chapter - 4

Learning Outcomes
4.1 work profile :

my work profile primarily focused on supporting various accounting functions within the organization. I
was involved in tasks such as financial data entry, assisting with accounts payable and receivable, bank
reconciliations, financial analysis, preparation of financial statements, conducting research and data
analysis, as well as supporting audit and compliance activities .

o Assisting with financial data entry: As an intern, I am responsible for entering financial
transactions into the accounting software or spreadsheets.
o Supporting accounts payable and receivable: help in processing invoices, verifying payments,
and maintaining records of customer and vendor accounts.
o Assisting in bank reconciliations: This involves comparing the company's bank statements with
its accounting records to ensure accuracy and identify any discrepancies.
o Participating in financial analysis: should be involved in analyzing financial data, preparing
reports, and assisting in budgeting or forecasting activities.
o Assisting in preparing financial statements: This can include helping with the preparation of
balance sheets, income statements, and cash flow statements.
 o Conducting research and data analysis: assigned projects that require researching accounting
standards, industry trends, or analyzing financial data to support decision-making.
o Supporting audit and compliance activities: Assisting with internal or external audits, ensuring
compliance with financial regulations, and maintaining proper documentation.
o Collaborating with the team: Working alongside accountants and finance professionals to learn
from their expertise, ask questions, and contribute to the overall success of the team.

4.2 job responsibilities :

 Financial data entry and bookkeeping: responsible for accurately recording financial
transactions and maintaining organized records of income, expenses, and other financial data.
 Financial reports and statements: assist in preparing and maintaining various financial reports
and statements, such as balance sheets, income statements, and cash flow statements. These
documents provide insights into the financial health of the organization.
 Financial data analysis: helps in analyze financial data to identify trends, patterns, and
anomalies. This analysis can provide valuable insights for decision-making and strategic planning.
 Auditing and account reconciliation: support the team in conducting audits to ensure accuracy
and compliance. This involves verifying financial records, reconciling accounts, and identifying any
discrepancies.
 Tax return preparation: assist in preparing tax returns and ensuring compliance with tax
regulations. This may involve gathering necessary documentation, calculating tax liabilities, and
submitting the returns on time.
 Collaboration and teamwork: work closely with colleagues to ensure the accurate and timely
processing of financial transactions. This requires effective communication, attention to detail, and
the ability to work well in a team environment.
 Accounting software and tools: learn and utilize accounting software and tools to perform tasks
efficiently. This may include software for data entry, financial analysis, and report generation.
 Budgeting and forecasting: assist in the budgeting and forecasting processes. This involves
analyzing past financial data, identifying trends, and helping to create realistic budgets and
forecasts for the future.
 Continuous learning and development: have the opportunity to attend meetings and training
sessions to expand your knowledge and skills in the field of accounting. This helps you stay
updated with industry best practices and advancements.
 Overall contribution to the accounting department: Through teamwork and dedication, you'll
contribute to the overall success of the accounting department. Your efforts will help ensure
accurate financial reporting and support the organization's financial goals.

4.3 New Concepts learned :

  Financial Statements: You'll gain a deeper understanding of financial statements, such as the
balance sheet, income statement, and cash flow statement. These statements provide valuable
information about a company's financial performance and position.
 Bookkeeping: You'll learn the fundamentals of bookkeeping, including recording financial
transactions, maintaining ledgers, and reconciling accounts. This helps ensure accurate and
organized financial records.
 Budgeting and Forecasting: You'll discover how to create budgets and forecasts to assist
organizations in planning and managing their financial resources effectively. This involves
estimating future revenues, expenses, and cash flows.
 Cost Accounting: Cost accounting focuses on analyzing and allocating costs within a business.
You'll learn techniques for tracking and controlling costs, such as job costing, process costing, and
activity-based costing.
 Auditing: Auditing involves examining financial records to ensure accuracy and compliance with
regulations. You may learn about different types of audits, internal controls, and how to assess risk.
 Taxation: You'll gain knowledge of tax laws and regulations, including income tax, sales tax, and
payroll tax. Understanding tax concepts enables you to assist with tax planning and compliance.
 Financial Analysis: You'll develop skills in analyzing financial data to evaluate a company's
performance and make informed decisions. This may involve calculating financial ratios,
conducting trend analysis, and interpreting financial metrics.
 Internal Controls: You'll learn about the importance of internal controls in safeguarding assets,
preventing fraud, and ensuring accurate financial reporting. This includes understanding
segregation of duties, authorization processes, and control procedures.
 Software Applications: Many accounting internships involve using accounting software, such as
QuickBooks or SAP. You'll become familiar with these tools and learn how to navigate their
features to perform tasks efficiently.
 Professional Ethics: Ethics play a vital role in the accounting profession. You'll be introduced to
ethical principles and standards, such as confidentiality, objectivity, and integrity, that guide
accountants' behaviour and decision-making

4.4 Skills Learned :

 Financial data analysis: I gained experience in analyzing financial data to identify trends, patterns,
and discrepancies.
 Attention to detail: Working with numbers requires a high level of accuracy, and I honed my
attention to detail skills to ensure precision in my work.
 Accounting software proficiency: I became proficient in using accounting software, such as
QuickBooks or Excel, to perform tasks like data entry and generating financial reports.
 Financial statement preparation: I learned how to prepare financial statements, including balance
sheets, income statements, and cash flow statements.
  Budgeting and forecasting: I assisted in budgeting and forecasting activities, which involved
analyzing financial data and making projections for future periods.
 Communication and teamwork: I collaborated with colleagues and communicated effectively to
ensure smooth workflow and accurate financial reporting.
 Time management: As an intern, I had to juggle multiple tasks and meet deadlines, which helped
me improve my time management skills.
 Compliance and regulations: I familiarized myself with accounting regulations and compliance
requirements, ensuring that financial practices adhered to legal and ethical standards.

4.5 Usefulness of internship for learning and development :

 Practical Application: An internship allows you to apply the theoretical concepts you've learned in
the classroom to real-world scenarios. This practical experience enhances your understanding of
accounting principles and their practical application.
 Skill Development: Through an internship, you have the opportunity to develop and refine various
skills, such as financial analysis, data entry, financial reporting, and communication. These skills
are crucial for a successful career in accounting.
 Industry Exposure: Internships provide exposure to the accounting industry, giving you insights
into the day-to-day operations of an accounting department or firm. This exposure helps you
understand the industry's dynamics, trends, and challenges
 Networking Opportunities: During an internship, you can build connections with professionals in
the accounting field. Networking can lead to mentorship, job referrals, and future career
opportunities.
 Resume Enhancement: Having an accounting internship on your resume demonstrates practical
experience and makes you stand out to potential employers. It shows that you have practical
knowledge and have been exposed to real-world accounting practices.
 Professional Growth: An internship allows you to develop professionally by building confidence,
improving problem-solving skills, and adapting to a professional work environment. It also helps
you gain a better understanding of your career goals within the accounting field.
 References and recommendations: A successful internship can lead to strong references and
recommendations from supervisors and colleagues. These endorsements can be valuable when
applying for future job opportunities.
 Increased job prospects: Completing an accounting internship increases your chances of securing
a full-time position in the field. Many companies prefer to hire interns who have already
demonstrated their skills and potential during their internship period.

4.6 challenges faced during internship :

  Limited experience: As an intern, you may have limited experience in the accounting field. To
overcome this challenge, be open to learning and ask questions. Take advantage of the opportunity
to shadow experienced professionals and seek guidance when needed.
 Complex tasks: Accounting tasks can be complex and require attention to detail. If you face
challenges in completing tasks, break them down into smaller, manageable steps. Seek guidance
from supervisors or colleagues to ensure accuracy and understanding.
 Time management: Balancing multiple tasks and deadlines can be challenging during an
internship. To overcome this, prioritize your work, create a schedule, and communicate any
potential conflicts or delays with your supervisor. Effective time management will help you stay
organized and meet deadlines.
 Technology proficiency: Accounting software and tools are commonly used in the field. If you're
unfamiliar with specific software, take the initiative to learn and familiarize yourself with it. Seek
training or ask for guidance to enhance your proficiency.
 Communication: Effective communication is crucial in accounting. If you face challenges in
understanding instructions or communicating your work, don't hesitate to ask for clarification.
Actively listen and seek feedback to improve your communication skills.
 Adapting to the work environment: Each workplace has its own culture and dynamics. Adapting
to a new work environment can be challenging initially. Observe and learn from your colleagues, be
respectful, and maintain a positive attitude. Building good relationships with your colleagues will
help create a supportive work environment.
 Ethical dilemmas: Accounting involves handling sensitive financial information. You may
encounter ethical dilemmas during your internship. Seek guidance from your supervisor or follow
the organization's ethical guidelines to address these dilemmas appropriately.
 Workload and pressure: Depending on the organization, you may experience a heavy workload
and pressure to perform well. To manage this, prioritize tasks, communicate any challenges or
concerns, and seek support when needed. Remember to take breaks and maintain a healthy work-
life balance.
 Feedback and constructive criticism: Receiving feedback and constructive criticism is an
essential part of professional growth. Embrace feedback as an opportunity to improve and learn
from your mistakes. Use the feedback to enhance your skills and performance.
 Resilience and perseverance: Internships can be challenging, but staying resilient and persevering
through difficulties is important. Maintain a positive mindset, seek support from mentors or
colleagues, and remember that challenges are opportunities for

4.7 Learning out comes

Journal voucher : steps of creating journal voucher

1. Open Tally and select the company in which you want to post the journal entry.
2. Go to the "Accounting Vouchers" section and choose "Journal Voucher" from the list of voucher types.

3. Enter the date of the journal entry.

4. In the "Debit" column, select the appropriate ledger account and enter the amount to be debited.

5. In the "Credit" column, select the corresponding ledger account and enter the amount to be credited.

6. Repeat steps 4 and 5 for all the debit and credit entries in the journal.

7. If needed, you can provide additional details or narration in the "Narration" field.

8. Double-check all the entered information for accuracy.

9. Save the voucher by pressing the appropriate key or clicking on the "Save" button.

Contra voucher : steps in creation of contra voucher

1. Open Tally and select the company for which you want to create the contra entry.

2. Go to "Gateway of Tally" and click on "Accounting Vouchers" or press "V" on your keyboard.

3. In the accounting vouchers menu, select "Contra" or press "F4" on your keyboard.

4. Enter the date of the transaction in the "Date" field.

5. Select the first ledger from which you want to transfer funds in the "Debit" field.
6. Enter the amount in the "Amount" field.

7. Select the second ledger to which you want to transfer funds in the "Credit" field.

8. Enter the amount in the "Amount" field.

9. In the "Narration" field, you can provide additional details about the contra entry if needed.

10. Press "Enter" to save the voucher.

Payment voucher : steps in creating payment voucher

1. Open Tally and select the company in which you want to post the payment voucher.

2. Go to the "Accounting Vouchers" section and choose "Payment Voucher" from the list of voucher types.

3. Fill in the necessary details such as the date of the payment, the party's name, and the payment amount.

4. Select the appropriate ledger account for the payment from the "Account" field.

5. If you have multiple payment modes, you can specify the mode of payment in the "Payment Details"
section.

6. If applicable, you can also mention any additional details or narration in the "Narration" field.
7. Verify all the entered information and make sure it is accurate.

8. Save the voucher by pressing the appropriate key or clicking on the "Save" button.

Receipt voucher : steps in creating receipt voucher

1. Open Tally and select the company in which you want to post the receipt voucher.

2. Go to the "Accounting Vouchers" section and choose "Receipt Voucher" from the list of voucher types.

3. Enter the necessary details, such as the date of the receipt, the party's name, and the receipt amount.

4. Select the appropriate ledger account for the receipt from the "Account" field.

5. If you have multiple modes of receipt, you can specify the mode of receipt in the "Receipt Details"
section.

6. If needed, you can also include any additional details or narration in the "Narration" field.

7. Double-check all the entered information for accuracy.

8. Save the voucher by pressing the appropriate key or clicking on the "Save" button.
Bank reconciliation statement : steps in posting entries from balance sheet to bank reconciliation
statement

1. Open Tally and select the company in which you want to work.

2. Go to the "Banking" section and choose "Bank Reconciliation" from the list of options.

3. Select the bank account for which you want to reconcile the transactions.

4. Tally will display a list of transactions from the bank statement. Compare these transactions with the
entries in your balance sheet.

5. For each transaction in the bank statement, find the corresponding entry in the balance sheet.

6. If the transaction is already recorded in Tally, select it from the list and mark it as reconciled.

7. If the transaction is not recorded in Tally, you need to create a new entry. Go to the "Accounting
Vouchers" section and choose the appropriate voucher type (such as payment or receipt voucher) to record
the transaction.

8. Enter the necessary details, such as the date, party's name, and the amount.
9. Select the appropriate ledger account for the transaction from the "Account" field.

10. Save the voucher and return to the bank reconciliation screen.

11. Mark the newly created entry as reconciled.

12. Repeat steps 6 to 11 for all the transactions in the bank statement.

13. Once you have reconciled all the transactions, Tally will show the reconciled and unreconciled
amounts.
Tax invoice :
4.8 Comparison of practical learning VS theory

Being a part of an intern it had been a delightful experience. One can get the practical knowledge along
with a chance to improve and learn the skill. One of the most important lessons that I have learnt during the
internship period is how to perform various tasks in the disciplined manner. Besides this, I also learned
about the working of the general banking transactions and exposure to practical field. An internship
experience enables an individual to gain insight knowledge about the practical working environment that
an individual gained through theoretical and lecture learning. But in reality, practical learning and theory
learned in college are different. This is so because theoretical knowledge involves basic definition, process
and steps of any subject whereas a practical learning involves the tools and techniques in order to put that
theory into practice.

In universities, we learned about the organizational structure in organization management classes. And the
thing I found while doing my internship is that the uses and functional structure as well as divisional
structure. In functional structure each portion of the organization is grouped according to its purpose.

On the other hand, what I found to be relevant during gaining this practical knowledge that matches with
the theories learnt in classroom is the advantages of double entry system. It records all financial
transaction by debiting and crediting the transaction. With the help of this system, one can ascertain profit
and loss of the bank. Thus, it further helps to prepare a balance sheet by providing details about assets and
liabilities of the business which helps to present the financial position of the business. It also helps to check
the arithmetical accuracy by preparing a summary report called trial balance. On the contrary, it reduces
errors and irregularities as a transaction is recorded in two places (i.e. accounts). Thus it reduces the
possibilities of frauds, errors and manipulation of accounts. The double entry system records transactions in
a scientific and systematic manner, thus it provides a reliable record of all transactions of a business. The
results and reports generated by using this system is reliable to great extent for decision making purpose
too.

In order to survive in a professional world, both theory as well as practical learning is very important.
Theoretical knowledge provides basic information and guidelines where as practical learning provides
better understanding on the subject through practical experiences.