Bookkeeping relies on the accurate, reliable and timely recording of financial transactions. The following principles apply:
Accuracy – Record transactions accurately, including verified, precise figures, and not guesses or estimates.
Reliability – Record transactions in the proper place. For example, a direct cost, i.e. the manufacturing cost of a product, should be allocated under “cost of goods sold”, not under “general selling and administrative expenses.”
Timeliness – Record transactions promptly to ensure data accuracy and to avoid forgetting any details.
Consistency – Follow data entry rules to ensure that transactions are always recorded in the same manner.
Simplicity – Use a simple data-entry process. For example, a transaction should be entered only once. Multiple entries of the same information increase the risk of error.