Maintaining a record of the total amount of money coming into and out of your business is crucial for several reasons. It allows you to spot patterns, better manage your cash flow, and plan for growth in the future. It’s critical for keeping tabs on expenses to ensure you’re staying within your budget.
There are a variety of ways you can keep track of the transactions in your company, from automated systems and accounting software to Excel spreadsheets or manual tracking methods. Each method has its pros and cons, however all of them will help you stay organised and have a clear understanding of your company’s financial health.
For example, if you’re using an online platform to trade shares and stocks through your demat account, a specific number will be assigned and then passed along the transaction pathway every time an automated step occurs. This number is an ID for the transaction that will be recorded in the various systems that make up the transaction. This allows for all of the information to be tracked back to its origin regardless of whether it has been processed in multiple systems of different companies.
Without this transaction tracing, the process would be a mess and time-consuming because it involves manually comparing invoices with payments or credit card statements. It could take a long time to complete each stage especially if the customers don’t include their invoice numbers when making payments. Monitoring control is essential because it enables top-of-the-line visibility by combining data from different mainframes, servers, databases apps, etc.
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