Question

act 8 It is necessary to process accounting data to comply with tax reporting requirements. What accounting data should be recorded in an organisation and why should it be recorded? (160–200 words)

Answer 1

Yes,it is necessary to process and analyse accounting data to comply with tax reporting requirements,effective tax governance helps an organisation to comply with tax administration obligations.One of the most important uses of our accounting records is to help to comply with federal and state tax laws and prepare our annual tax returns.If we keep good records and operate our business in a professional manner,we will find tax complaince pretty easy.

the accounting system includes expenditures,revenues,assets and obligations or liabilities , the income earned by an individual throught the year minus the expenses are the incom which is needed to be taxable.we need to keep the following records for atleast 5 years:

• reciepts for supplies including cash register,supplies register,deposit books and bank statements.
• acquisition and other expenses including expenses payment records,invoices and acqusition statements,petty cash details,logbooks.
• wages and salaries including employment funds and declarations,worker payment records.
• copies of contracts and land agreements,lease agreements,revaluation etc
• financials statemnts including balance sheet, income statement and cash flow statements and notes to accounts.