The Arts Board, through a review conducted by the state Legislative Audit Bureau, has developed this handbook to describe some basic accounting procedures for organizations experiencing difficulties establishing a system or wishing to improve their present procedures for recording income and expenses. The examples and procedures provided do not represent the only available system for recording these accounting transactions. However, they do provide basic guidelines for your use. Organizations with access to personal computers may find it easier to obtain accounting software packages to assist in this area. Inc. We will use ABC Art's financial data to illustrate some important concepts in financial record keeping.
Number accounts for each major income and expense category.
The same account titles should be consistently used from year to year. If you no longer need one category it can be dropped and new categories can be added as needed. It is recommended that when an account has been dropped, the assigned number not be reused. Any income and expenses which you have not classified as a major income or expense should be recorded in these accounts. Create your general journal and account ledgers.