Therefore, one important purpose of preparing trial balance is to provide a check on the arithmetical accuracy of the recordings of the financial transactions. 2. To Help Locate Accounting Errors Since the trial balance indicates if there is any error committed in the Journal and the ledger, it helps the accountant to locate the error because the starting point of locating errors is trial balance itself. 3. To Summarize The Financial Transactions A business performs several numbers of financial transactions during a certain period of time.
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The transactions themselves can not portray any picture of the financial affairs of the business. For that purpose, a summary of the transactions has to be drawn. The trial balance is prepared with a view to summarize all the financial ransactions of the business. 4. To Provide The Basis For Preparing Final Accounts Final accounts are prepared to show profit and loss and the financial position of the business at the end of an accounting period. These accounts are prepared by using the debit and credit of all ledger accounts.
Therefore, since the trial balance is a statement of the debit and credit balances of the ledger accounts, it provides the basis for the preparation of the final accounts. Sol 5:- Corporate governance refers to the system by which corporations are directed and controlled. The governance structure specifies the distribution of rights and esponsibilities among different participants in the corporation (such as the board of directors, managers, shareholders, creditors, auditors, regulators, and other stakeholders) and specifies the rules and procedures for making decisions in corporate affairs.
Governance provides the structure through which corporations set and pursue their objectives, while reflecting the context of the social, regulatory and market environment. Governance is a mechanism for monitoring the actions, policies and decisions of corporations. Governance involves the alignment of interests among the stakeholders.See More on Debits