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Financial transactions and reporting are the methods of recording and analyzing the flow of money within an organisation. It is a vital procedure that needs to be done correctly and in a professional manner in order to produce reliable, accurate financial reports and ensure conformance with external requirements. This article will outline the general requirements and best practices for substantiating transactions as well as the documentation required to back up any financial transaction.

A financial transaction is the change in the total assets and liabilities of an institution or its parts in the course of interactions between institutional units undertaken for commercial reasons. This does not include the cancellation or reduction of bad debts as well as the unilateral cancellation by an individual creditor of a debt. These are recorded as different changes to the amount of assets.

Substantiation refers to the exact original source documentation or work papers supporting an financial transaction. The documentation must be concise enough to be able to stand on its own and answer the following questions: who is who, what, when and why. The substantiation must also be connected to the general ledger transaction information.

A solid financial report can show your company’s financial stability and build confidence with creditors and investors. It also helps keep you fully in compliance with tax laws. Utilizing an online reporting tool like datapine will cut down on the need for manual work and let you create a an accounting statement in a short time. This will allow you more time to focus on other tasks that are important, such as creating a strategy.

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