Accounting Advisory Services

From Pan to Crypto: New income tax reforms that take effect on July 1

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Income Tax on Digital Assets

Starting July 1, 2022, a number of changes will take effect that will have an impact on your income tax. In this regard, it is also crucial to keep in mind that July 1, 2022, also marks the beginning of the fiscal year’s second quarter. This includes changes to the laws governing income tax and TDS on cryptocurrency. These are some significant changes in income tax reform that will take effect on July 1, 2022.

TDS on Cryptocurrencies:

In January 2022, Finance Minister Nirmala Sitharaman suggested a 1% tax deducted at source (TDS) on any payment made in exchange for the transfer of virtual digital assets (VDAs), often known as cryptocurrencies and non-fungible tokens (NFTs). The TDS regulation will be in force beginning on Friday, July 01, 2022 for transactions with a value of more than Rs. 10,000.

A 20% tax deduction will be made at the time of transfer of the VDA if the deductee’s (buyers’) PAN is not immediately accessible. If the payer is not one of the people listed and they have not filed their income tax return, TDS will also be withheld at a higher rate of 5 percent (instead of the standard rate of 1 percent).

The PAN-Aadhaar Non-Linkage costs twice as much:

The final day for connecting Aadhaar and PAN was June 30, 2022. In line with CBDT regulations, if a person combines their PAN with Aadhaar between March 31, 2022, and June 30, 2022, they must pay a 500-rupee late fee. However, if someone fails to connect their PAN with their Aadhaar before June 30, 2022, they will be subject to a twofold fine of Rs. 1,000 starting on July 1st, 2022.

For doctors and social media influencers, the new income tax information is as follows:

Rewards received from businesses for sales promotion by doctors and social media influencers will be subject to a 10% tax deduction at source starting July 1, 2022. (TDS). In line with a notice from the Central Board of Direct Taxes (CBDT), the giver of the benefit or perquisite may immediately deduct the tax under Section 194R. However, the taxpayer must confirm the recipient’s possession of any taxable sums.

In line with Section 194R, taxes must be deducted from benefits and perks when their total worth exceeds Rs. 20,000.

Update on Income Tax (IT) Return Filing:

The new income tax regulations now include a new clause that enables taxpayers to file a revised return in the event that their income tax returns contain errors or inaccuracies. Taxpayers now have two years from the conclusion of the applicable assessment year to file an amended return.

Changes in Demat KYC Rules:

To prevent having your demat account frozen, you must complete your KYC before June 30. To update your KYC, you must provide your name, place of residence, PAN, active mobile phone number, active email address, and range of income. But starting on July 1, your demat account will likewise be inactive if you do not do this.

Why choose us?

Komplytek is a leading business advisory and consulting firm that specialises in management consulting. Our areas of expertise include financial operations; payroll management; human resources; payroll management; strategies and development; financial planning; and consulting in data analysis. We also help businesses all over the world with their planning and operational challenges.

By using artificial intelligence, we also provide businesses with more flexibility, wiser judgement, and data-supported options with reduced costs and risks.

By collaborating with a firm to develop development ideas or carry out operations, we greatly increase a company’s value. Additionally, we provide excellent, safe, and customised solutions based on your company’s needs.

Komplytek is a one-of-a-kind company that provides a variety of consulting and outsourcing services to clients worldwide. By outsourcing the finance and compliance functions of the firms to us, we make it convenient for business owners to focus on their essential and core business activities. We are a “One-Stop Solution” for finance and accounting, compliance and regulatory, and other operational portfolios. Our solutions can also be tailored to meet your specific business needs.

Our team comprises of people who have extensive industry knowledge, skills, and experience. This is crucial in addressing any turbulence in the business world and guaranteeing smooth operations. We ensure that we think like you and act as part of your team rather than an outsourcing partner.

To assist our clients, follow the law, we also lower risk by combining the finest strategic approach with cutting-edge technology.

5 Reasons to Hire a Finance Consulting Firm

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Finance-Consulting-Firm

The life of a businessman is not easy. You must manage everything from the small to the large. Financial management is not for everyone. This is where the role of a finance consulting firm comes into the equation. Individuals and small businesses can get help from a finance consulting firm to manage and grow their money and assets. They also help their clients with a variety of responsibilities, including financial data, financial forecasting, and investment advice based on their long and short-term objectives.

Financial consulting firms and financial advisory firms are similar terms. Prior to now, a financial consulting firm could only assist with businesses’ transactional needs. Modern entrepreneurs, on the other hand, demand tailored services to increase their company’s efficiency. As a result, their role was redefined and widened. A finance consulting firm now provides a comprehensive service that assists its clients in achieving financial success in all areas.

What qualities should you seek for in a financial consultant?

  • Negotiation Skills of the Highest Order
  • Communication abilities that are both effective and efficient.
  • As required by law, licensed and registered
  • Financial consulting firms must have extensive knowledge of developing financial strategies for many types of businesses.

What Services does a Finance Consulting Firm Provide?

A finance consulting firm examines the entire picture of a client’s finances, including obligations, assets, expenses, and revenue, to assist clients in identifying their objectives. A finance consulting firm with the appropriate licenses can also handle the investments of its clients.

Here’s Why More Companies are Hiring a Finance Consulting Firm

There is no denying that the workforce is changing as a result of new technology and increasing growth needs. The most notable current trend is that an increasing number of businesses are outsourcing staff and consultants. Here are five reasons why hiring a finance consulting firm is the way of the future.

1. Provides You with a Larger, More Complete Perspective of Business

Hiring a professional from a finance consulting firm may help your company and provide you with added security. The finance consultant arrives with a planned company strategy and also tactics, allowing them to see the full picture of your financial status. As a result, financial plans may be evaluated, reviewed, and modified in response to changing company circumstances. Furthermore, it helps your company become more structured and equipped for the future, as well as any challenges that may develop, with contingency plans in place if necessary.

2. Expert Recommendations

Businesses rely heavily on consultants. They have worked in a variety of industries and have a thorough understanding of business dynamics, expert knowledge, and technological advancements and processes. Financial planning by a competent financial advisory firm also assists in putting all the elements of your financial business together, from budgeting to preparing for business development to handling taxes and insurance needs.

3. Tax Benefit

Certain countries’ tax laws are complex, and even the smallest error might result in severe financial consequences. In addition, as a result of their errors, these business owners must pay hefty fines. All of these issues and their ramifications are known to a financial consulting firm, and they are addressed ahead of time. Launching new companies or offering advice on current tax law changes might help minimize your tax burden.

A financial consulting firm can also assist you in lowering your tax obligation by launching new investments for long-term benefits, and tax efficiency, or counselling you on the most recent major reforms.

4. Saves Time

An entrepreneur does not have enough time to analyse each matter carefully. The finance consulting firm is adept at identifying the company’s soft spots, allowing you to devote your time and attention to those aspects of the organization that require it.

As a result, hiring a financial consulting firm is preferable. They are a collection of professionals who can help you manage your financial portfolio properly. This also allows you to focus your time and efforts to more profitable and productive endeavours if you are not burdened with this onerous duty.

5. Stress Relief

A competent financial consultant may relieve a lot of burden from your mind, and your business can profit from the consulting firm’s high financial literacy. You may now relax since you are in the hands of an investing specialist who is handling a wide variety of issues and obstacles that you would otherwise have to deal with on your own. This also leaves more time to keep a watchful eye on the markets.

Why choose us?

In order to maximise productivity in the crucial spin-out areas of your company, Komplytek provides integrated services and adaptable solutions that are smart by design. For finance & accounting, compliance & regulatory, and other operations portfolios, we provide a “One Stop Solution.”

 

4 Essential Benefits of GST for Small Businesses & Start-ups

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Benefits of GST for Small Businesses

Benefits of GST for Small Businesses

In India, GST was implemented to simplify the tax assessment process. To make the compliance process easier, GST was formed with the tagline “One Country, One Tax System.” In this blog, we will look at a few of the key elements of the Goods and Services Tax implementation process for new firms in India.

A Quick Overview of Goods and Services Tax

A value-added tax is the Goods and Services Tax. It covers all stages along the supply chain, right from the manufacturer to the final consumer. As a result, the tax will be borne by the end customer, as the final person/entity in the supply chain. India’s indirect tax structure has been made simpler by the Goods and Services Tax. Both the federal and state governments are subject to the tax framework. It will also replace India’s present many levels of complex taxes.

Here are Four Benefits of GST for Small Businesses and Start-Ups

GST will be a single tax covering all major indirect taxes. As per an evaluation of the GST’s impact on start-ups, they will likely profit.

 1. The widespread use of online registration

Other taxes, such as Excise Duty, VAT, Services Tax, Sales Tax, and so on, have been absorbed by GST. As a result, the main benefits are fewer tax filings and uniform formats. This saves a lot of time and paperwork. Although many states have different registration needs, the process is the same: it is done online and verified. Due to the ability to manage the majority of uploads online and with digital signatures, the GST registration also reduces the amount of manual paperwork.

2. Access to a single national market throughout India

It has major advantages for small firms. Most firms were required, under the previous tax system, to maintain substantial distribution and logistics networks since these networks were built to satisfy the requirements of state level tax reduction. Under the new approach, corporate requirements will drive distribution and logistics networks, allowing smaller firms an equal opportunity to compete with larger ones. For smaller firms looking to increase their national footprint with little expense, this single market throughout India will be a huge benefit.

3. It prevents taxation from cascading

Tax cascading is no longer an issue owing to the GST, which was formed to bring all major indirect taxes under one roof. For small firms, this means greater immediate savings. All indirect taxes were rolled into one with the Goods and Service Tax. In simple terms, the cascading effect was Tax on Tax, and the ITC (input tax credit) was introduced as a great benefit to firms to mitigate this.

4. Increasing the GST Registration barrier for Small Firms

Given that the registration limit is Rs. 40 lakhs, many small firms, mainly start-ups, are free from paying the GST. As a part of benefits of GST for Small businesses it offers a lower tax rate for small firms with a turnover of between 50 lakhs and 1.5 crore, notwithstanding the fact that it is optional. This is refer to as the composition plan under the GST. This will also reduce the tax burden on startup firms.

The GST has helped several sectors of the Indian economy. The benefits of the Goods and Service Tax also vary based on the sort of business you run.

Komplytek is a well-known GST consultant providing services to clients spread across industries and geographies. We provide our clients with entire Goods and Service Tax solutions, such as:

  • Obtaining a Goods and Services Tax registration
  • Preparing and filing GST returns on a monthly or quarterly basis.
  • Providing advice on a variety of subjects
  • Preparation and filing of Goods and Service Tax refund applications, as well as follow-up
  • Preparation and submission of yearly tax return

For Assistance in Managing your Small Business Accounting.

Get in touch with Komplytek today!

Effects of GST on Manufacturers, Distributors, and Retailers

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Effects of GST  on Manufacturers, Distributors, and Retailers

The GST is the largest indirect tax change in the world since freedom. The Indian economy benefited from the implementation of the plan since most items’ prices were reduced. It encourages the consumerism and hence improve economy.

In India, GST is an indirect tax on the supply of goods and services. The Government of India implemented the One Hundred and First Amendment to the Constitution Act 2016 on July 1, 2017, and GST went into effect on that day. It replaced the federal and state governments’ numerous existing taxes.

The Goods & Service Tax is a multistage, complete, destination-based tax. It has effectively absorbed almost all indirect taxes, except for a few state levies. This new tax structure has a slightly varying effect on diverse businesses. The first degree of difference will depend on whether the industry is in manufacturing, distribution, or retail.

The following are the Effects of GST on manufacturers, Distributors, and Retailers:

The Goods and Services Tax is improving India’s manufacturing sector’s competitiveness and performance. Previously, various indirect taxes have raised manufacturers’ and distributors’ admin expenses. However, now that GST is in place, compliance costs have decreased, and the industry is expanding at a faster rate as a result.

Businesses that had previously been exempt from taxation must now register for GST. As a result the Goods & Service Tax removes the possibility of tax avoidance.

The benefits of GST implementation in these industries include:

 

• Lower production costs.

Previously, manufacturers were unable to claim any tax credit of OCTROI, entry tax and other local body taxes and it increased the total cost of production of goods and services adding to manufacturing cost. The GST abolished these cascading taxes, saving manufacturer’s money on the spot. It also established the Input Tax Credit to assist in the reduction of tax bills.

• Increase in the competitiveness

Production costs have been reduced after the implementation of GST, hence it helps to increase the competitiveness of Indian Goods and services in the global market and give boost to Indian exports. The procedure is now much simpler thanks to Goods & Service Tax. The same GST rate applies regardless of the location of the suppliers and buyers. This allows you to pick the most cost-effective providers.

• Better Logistics

With the implementation of GST, numerous state border checkpoints were shut down immediately. You may now register shipments and pay taxes online using the e-way bill system. As a result, you will save time and money on logistics.z

• Simple Registration

One of the major effects of GST is the simplicity in the process. Previously, it was compulsory for manufacturers to register their plants in a single state. GST registration is PAN based and state specific. Manufacturers simply have to file for individual registration under the GST, regardless of the number of factories in a state.

• Longer evaluations are no longer necessary

Earlier, firms had to go through a confusing and lengthy tax assessment process. The companies had trouble answering questions about complicated and diverse taxes such as VAT, central excise, and sales tax. Different tax assessment authorities were in charge of different taxes.

GST was also implemented in the industrial sector, along with a composition scheme. This plan offers various incentives to dealers and producers, which includes:

 

  • The ability to pay GST quarterly rather than monthly relieves the burden of monthly payments.
  • Goods & Service Tax will be charged at a reduced rate of 1%.
  • Only the taxable supply turnover, not their whole income, will be subject to Goods & Service Tax.
  • Unlike ordinary taxpayers who do not use the composition plan, there is no requirement to keep extensive records or keep books.

Komplytek is a well-known GST consultancy in Delhi (NCR). We provide potent solutions to businesses across geographies and numerous industry verticals. Our team comprises team of lawyers and chartered accountants who bring many years of corporate experience with them. Our customers may get entire Goods and Service Tax solutions from us, including:

  • Obtaining a registration for the Goods and Services Tax
  • Preparing and reporting monthly or quarterly GST returns
  • Offering guidance on several topics
  • Goods and Service Tax refund applications, including preparation and filing, as well as follow-up
  • Annual tax returns preparation and submission

Importance of Tax Audit and its Impact on Business

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Tax-Audit

A tax audit is a detailed analysis of a taxpayer’s accounts from an income tax perspective, such as earnings, deductions, compliance with tax regulations, and so on.

An audit is just an assessment of books of accounts. Specific kinds of people and corporations must have their books of accounts audited under Section 44AB of the Tax Act of 1961. A tax audit is necessary for businesses and professions having more than a prescribed amount of revenue.

The goal of a tax audit is to ensure that the financial statements are prepared as per the applicable financial reporting framework and the information provided by the assessee is correct and accurate. Tax audits are necessary for taxpayers with a gross professional income of more than Rs 50 lakh or a company turnover of more than Rs 100 lakh (and who have not chosen the presumptive taxation plan).

What is the purpose of a Tax Audit?

Its primary objective is to make sure that you or your company follow the tax requirements established by the Income Tax Act of India. The  tax audit, once completed, makes it simple to prepare tax returns. It also reviews the company’s financial records to verify that they are providing the necessary information by quickly identifying any errors or abnormalities. It is also simple for the tax authorities to examine your income tax returns once you have completed a tax audit.

What role does it serve in the company?

In a business, a tax audit will have the following benefits or importance:

  • A tax audit will verify that the books of accounts and all other documents connected to revenue and spending are kept up to date, saving you time and worry.
  • It will also verify that the complete income and deduction claims are entered correctly and precisely by the company.
  • It decreases the possibility of deception.
  • A Tax Audit helps proper presentation of accounts before the tax authorities. It identifies the weaknesses in the accounting system.
  • An audit helps getting useful professional advice that can result in genuine financial gains for a company.
  • For employees, consumers, suppliers, investors, and tax authorities, an audit gives credibility to public information.
  • An audit provides assurance that the data in the accounting is true and fair.
  • An audit improves the company’s reputation.
  • For tax purposes, government authorities recognise audited statements as genuine and fair.
  • On the basis of their findings in the record, auditors might provide specific recommendations for company improvement.

What impact does a Tax Audit have on an organization?

Because a tax audit is an assessment of a company’s status as a taxable entity, it has a substantial impact on a company.

  • A tax audit can help you identify any financial inconsistencies in a company’s cash flow.
  • It can assist you and your company in finding more tax-compliant alternatives.
  • A tax audit can reflect a company’s transparency, integrity, and financial reliability.
  • It may thoroughly assess an entity’s present financial management system’s efficiency and effectiveness.
  • It also improves a company’s credibility and protects its reputation. After the audit, the actual worth of the company is also revealed.

Why should you choose Komplytek?

The Auditing Service offered by Komplytek entails a thorough examination of the client’s whole financial data and a determination of its accuracy. We provide unrivalled audit services, including assessing fraud risks, validating financial data, and analysing internal procedures. We also produce accurate financial accounts and handle the company’s other essential financial assets.

Komplytek can provide you with high-quality feedback on your business operations. We offer high-quality audit methods as well as trustworthy evaluation services to our clients. Our auditors are also up to date on the most modern auditing technologies. Komplytek can support you in the following audits:

  1. Internal Audit before finalisation of books
  2. Statutory Audit
  3. Stock Audit
  4. Assets Audit
  5. Any financial or compliance audits that are specific to a client.

 

8 Essential Benefits of GST

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GST-Tax

Following the introduction of the Goods and Services Tax (GST), the government was flooded with input on the tax’s benefits and drawbacks. The GST is a national value-added tax (VAT) that is imposed on the production, purchase, and delivery of goods and services.

It removes major indirect taxes imposed on products and services by state and federal governments. The Goods & Service Tax is substantial tax reform in India and in this post, we’ll look at the positives of GST taxation.

Benefits of GST

1. Business Ease

The Goods & Service Tax introduces the notion of a single national market. It deters states from engaging in harmful rivalry. It has now become beneficial to run a business across state lines.

2. Tax Documentation and Filing Made Easy

Entrepreneurs have benefited from the GST. Because there are no various taxes to deal with, compliance and documentation have become much easier. Filing a return, paying taxes, and obtaining a refund have all become much simpler.

3. Reduces Tax evasion and corruption

The GST Act improves tax administration by making it more transparent and free of corruption. The government lost money as a result of tax evasion before implementation of Goods & Service Tax. There are no hidden taxes, and this reduces the cost of doing business.

4. GST Removes Tax Cascading Effects

Goods & Service Tax combines the majority of indirect taxes levied across the country, removing the “tax on tax” impact that has plagued the supply chain and driven up end-user costs.

5. Powered by Technology

Because it is technology-driven, the entire registration and filing of returns procedure is speed up. It also guarantees that the process is transparent and that tax collection is in accordance with the law. Filling out the registration form, submitting a refund request, dealing with notifications, and dealing with consumer complaints are all facilitated through the GST Portal.

6. Product That Is More Competitive

The Goods & Service Tax has made manufacturing more competitive by addressing the cascading effect of taxes, interstate taxes, and excessive logistics costs. It has benefitted both entrepreneurs and customers.

7. Regulates poorly organized industries

In the country, the textile and construction industries, for example, are highly unstructured and unregulated. GST has made it easier to manage payments, compliance, and input credit online.

8. GST Scheme of Composition

The composition system provides relief from tax responsibilities for small enterprises. Any taxpayer with a turnover of less than Rs. 1.5 crore is eligible for this plan.

Goods & Service Tax and the “Make in India” initiative

GST is the backbone of this strategy, as it applies to imports and gives a boost to manufacturing by reducing superfluous costs. Another benefit is the removal of commercial roadblocks, which make transactions and the free movement of goods across state lines much easier. By removing the arbitrary taxing system, the GST model has united the Indian market. Manufacturing has benefited greatly from reduced logistical costs, and relief from export taxes and refunds.

Komplytek is a renowned GST consultant in Delhi and the NCR. We offer our customers complete Goods & Service Tax solutions, which comprise all services such as:

  • Acquiring Goods & Service Tax Registration
  • GST returns are generated and filed on a monthly/quarterly basis.
  • Consultancy on a variety of issues
  • Goods & Service Tax refund application preparation and filing, as well as follow-up
  • Annual return preparation and filing
  • Auditing and evaluation of the Goods & Service Tax
  • GST Number Cancellation

 

 

4 Key Responsibilities of Management Consulting Firm

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Management consulting

A management consulting firm helps companies improve their operational efficiency, create value, and grow their market share. In order to attain this goal, management consultants gather information from numerous sources within the company in order to resolve issues. A company could employ a business consulting firm to assist them in resolving a specific issue, such as financial, stock, or logistical challenges. As a management consulting firm, your primary responsibility is to provide guidance to your clients in key areas of their work.

Consultants typically rely on research and analytical skills to carry out their duties. The prime objective of a management consulting firm is to generate more income. They also provide their clients with suggestions and solutions to consider. A management consulting firm’s four key responsibilities are listed below.

1. Comprehensive Guidance:

The management consulting firm collaborates with the organization to formulate and develop the strategy. This is critical since it serves as the foundation for all of your task-solving strategies.

The management consulting firm must make a number of decisions. Making a decision is the action or process of considering various possibilities and choosing one. There are 5 components in a systematic strategy for how the consultants engage in the decision-making procedure.

  • Identifying the issue
  • Consider your options
  • Assessment that’s accurate
  • Choose a plan of action
  • Implement

2. Gathering and analyzing information 

A management consulting firm must perform a thorough survey to gather the information you require to establish a valid foundation for your suggestion. They also need to analyse the company’s present financial position. Because of their unbiased position within the firm, management consultants can be especially beneficial in obtaining quality data and brainstorming ideas.

3. Manager of Change

The managing consulting firm’s third most important role is that of the change manager. Any project aimed at improving performance must include organisational change. This is a more distinctive or specific role for a management consulting firm on very vast and diverse projects. They must also cope with unforeseen challenges such as unanticipated issues, solution malfunctions, or unexpected objections. In most cases, management consulting firms also play a significant role in resolving these solution snags.

A management consulting firm will typically oversee the development and implementation of a communication plan as a key solution.

4. Analysis of the situation

The consultant creates an evaluation plan to assess the strategies’ performance as well as the company’s overall progress.

The consultant will also determine how effective the solution was in achieving the companies’ objectives. Analysis of a company’s financial statements and records to ensure compliance with laws and regulations, proposing measures to minimise expenses and increase revenue, estimating taxes, and preparing tax filings are all common activities.

Why choose us?

Komplytek is a business advisory and process control firm. We specialise in customer service, human resources, strategies and development, financial planning, systems integration, and data analysis consulting. We also assist government agencies, non-profit organizations, and enterprises around the world with planning and operational difficulties.

Outsourcing a business consultancy firm helps businesses pay just for the services they desire, instead of putting in inexpensive technology or paying to retain people who may not be required at all times. By assisting in the development of growth strategies or the execution of operations, we add a considerable amount of value to a firm.

By outsourcing the finance and compliance functions of the organisation to us, we make it convenient for business owners to focus on their essential and core business activities. We are a “One-Stop Solution” for finance and accounting, compliance and regulatory, and other operations portfolios. Our solutions can also be tailored to meet your specific business needs.

We have a team of lawyers and chartered accountants who bring many years of corporate experience with them. We ensure that we think like you and act as part of your team rather than as an outsourcing partner.

4 Main Financial Statements

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financial-statements

4 Main Financial Statements

Accounting is a term referring to all of a business’s financial transactions. A well-run accounting department have processes and procedures for financial statements, accounting management, and data processing. Accounting department is responsible for the preparation of the financial statements, as well as ensuring that they are accurate and comply with the rules.

However, the actual reason for examining your financial statements is that it provides information about the net profit, financial position and cash flows to management. You’ll use financial statements as a guide to what’s possible if you want to raise funds, develop a new product, build a new office, or make any other move to grow your business.

A Dynamic Report

The majority of organizations prepare a periodic financial statement for investors and shareholders. A financial statement is a dynamic report that contains a wealth of data. This information is available for analysis and application to your company’s goals. Being proactive instead of reactive necessitates a full understanding of each statement.

The financial accounts reflect the impact of business accounting records on the firm. The many sorts of financial statements are not separate from one another but intertwined.

The basic financial statements provide insight into your overall financial viability, so understanding them is vital. We’ll go over the 4 main financial statements and how they can help your company move forward in this post.

1. Balance Sheet

A balance sheet is a financial statement that shows the assets, liabilities, and equity of a business at the end of a fiscal year. Regardless of the size or nature of the firm, the balance sheet is an official document that follows a traditional accounting framework.

The basis for assessing returns for investors and evaluating a company’s financial framework is the balance sheet. In a nutshell, it depicts a company’s financial status at a specific point in time.

On the balance sheet’s left side, you can see the assets. On the right, you’ll see a list of liabilities and equity.

2. Income statement

One of the most essential financial statements for summarizing a company’s financial health over a specific accounting period is the income statement. The income statement gives an overview of an entity’s operational performance over a specific period, as well as statistics on income generated and expenditure incurred.

Income statement helps to calculate net profit. Net profit is the amount money left after subtracting a company’s total expenses from its total revenue for a specific period of time. The profit and loss statement is another term for it.

In addition, income statements provide earnings per share (or “EPS”). This calculation indicates how much money shareholders would get if the firm chose to pay 100% of the period’s net earnings.

3. Cash flow statement

Cash flow statements show the inflow and outflow of funds. This is critical because a business must have enough cash flow to pay its bills and acquire assets. The cash flow statement illustrates where the money comes from. It also allows you to keep track of how much money comes in and goes out. It is generally used to produce a money projection to plan for the short term.

Operating, investment, and financial operations are all sources of incoming cash for a company. The statement also shows cash inflows, business-related expenses, and investments at any particular time.

4. Statement of retained earnings

The statement of retained earnings includes a specified period and shows the dividends paid to shareholders from earnings as well as the earnings retained by the firm. This is the financial statement being used the least.

The income statement and balance sheet are frequently seen by top management when financial statements are presented internally since they are relatively simple to prepare.

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GST-Definition & 4 Types of Good & Service Tax

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Types of Goods & Services Tax

The Goods and Services Tax (GST) is a tax imposed in India on goods and services or both, and it went into force on July 1, 2017. The tax was created to replace major existing indirect taxes with a single comprehensive tax.

In essence, Goods and Service Tax combines several indirect taxes into a single tax, making tax compliance management easier for service and commodity businesses. Various indirect taxes, such as the central excise tax, service tax, VAT, entertainment tax, etc., were rolled into the GST. This huge development has made it easier to file a tax return without the challenges that were faced in the past.

What is Goods and Service Tax (GST) and how does it work?

Goods and Service Tax is a destination-based tax applicable on all transactions involving the supply of goods and services or both for consideration subject to exceptions thereof. It is a tax paid on the manufacturing and sale of goods and services throughout the nation. It provides a complete and continuous credit chain. Goods and Services Tax is a single domestic indirect tax law that applies to the entire nation.

What impact will the Goods and Services Tax have on the current indirect structure?

The Goods and Services Tax is an effort to break down geographical boundaries and form a single market within the country. The effect, on the other hand, would not be consistent and would vary from one industry to the next. The ordinary citizen will benefit in two ways: firstly, all taxes will be gathered at the point of usage; and secondly, customers will not be compelled to pay a “tax on tax.”

When a supplier’s location and the place where goods/services are supplied are in two separate states, two different union territories, or a state and a union territory, it is categorized as either an interstate supply of goods or an interstate supply of services. All inter-state supplies are subject to IGST, which is the sum of CGST and SGST/UTGST collected by the Centre.

GST is classified into the following categories:

 

1.The State Goods and Services Tax (SGST)

The State Goods and Services Tax is one of the taxes levied by the state government on the exchange of goods and services. It is imposed on the intra-state supply of goods and services, or both. The Sales Tax, Entertainment Tax, VAT, Entry Tax, and other state taxes are all replaced by the SGST, which is imposed by each state’s state government. The state government is entitled to claim earned revenue under this tax.

2.The Integrated Goods and Services Tax (IGST)

The Integrated Goods and Service Tax is levied on interstate goods and services transactions. When a supplier’s location and the area where goods/services are supplied are in two separate states, two different union territories, or a state and a union territory. It is categorized as either interstate supply of goods or interstate supply of services. All inter-state supplies are subject to IGST, which is the sum of CGST and SGST/UTGST collected by the Centre.

3. The Central Goods and Services Tax (CGST)

The Central Goods and Service Tax is charged on transactions of goods and services that take place inside a state. It was implemented by the Central Government to replace major central taxes such as Central Sales Tax, Service Tax, Central Excise Duty and Additional Excise Duty, CVD and Special CVD, etc. The Central Goods and Service Tax is levied and collected by the Central Government.

4. The Union Territory Goods and Services Tax

The purpose of imposing Union Territory Goods and Services Tax on intra-UT supplies of goods and services is to apply a tax collection to give benefits similar to SGST. It applies to Lakshadweep, Daman and Diu, Dadra and Nagar Haveli, Andaman and Nicobar Islands, and Chandigarh, which are all Union Territories.

Komplytek is a renowned consultant in Delhi and the NCR. We offer our customers complete Goods & Service Tax solutions, which comprise all services such as:

  • Acquiring Goods and Service Tax Registration
  • Goods and Service Tax returns are generated and filed on a monthly or quarterly basis.
  • Consultancy on a variety of issues
  • GST refund application preparation and filing, as well as follow-up
  • Annual return preparation and filing
  • Cancellation of Goods and Service Tax Number

 

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7 Factors of Financial Statement Disclosure

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Financial Statement Dislosure

Financial Statement Disclosure is the basis of transparency that can reduce wrongdoing and errors. A “financial statement disclosure” is a report that recognizes the financial position of a company. It also provides relevant internal and external information about a firm or a company’s financial strategies to experts, stakeholders, and future investors. 

Financial disclosure include data related to reports of stakeholder’s equity, net sales, balance sheets, cash flow, and revenue statements, and strategies of accounting that are practiced in the business operation.

The International Auditing and Assurance Standards Board (IAASB) in recent years has set high-quality auditing standards for assurance, quality control, and related services standards to increase the consistency and quality of practice by qualified accountants across the globe. The IAASB focuses on building public trust in the global auditing profession. As per International Accounting Standards (IASs) and International Financial Reporting Standards (IFRs), it’s a legal requirement for all companies to disclose their financial policies publicly. This permits transparency in the system and aids in maintaining a standard reporting format. 

A good financial consulting firm will take into consideration various factors at the time of auditing disclosures in financial statements, such as:

1. The scale of the firm

The scale of the firm is one of the most crucial factors that impacts the level of financial statement disclosure. Scaling implies a firm is being able to take on the increased load in a cost-effective way and meet the demands of its business without suffering. Scaling is also very important for sustainable growth. A proper approach is required for scaling a business that focuses on increasing profits and efficiency at the same time. Disclosing such information to the public will attract more investors.

2. Life of the firm:

The companies which have sustained for a reasonable period of time have a positive effect on the financial disclosure. The perpetual businesses will have an exemplary disclosure as it has enhanced over a period of time. 

3. Board size:

The board of directors will take care of the company’s operations in a manner that is favourable to the business. They also exercise the power to observe and control the management. This will reduce the difference of opinion and conflict between the manager and investors. An organization with a more independent board of directors will benefit from better financial disclosure. 

4. Audit status:

An audit is essential as it gives reliability to financial reports. It also ensures that the firm’s financial statement complies with the law. Audit firms assure the realistic representation and objectivity of the financial statements. It is also a basis for an investor to make an investment decision. Therefore, big auditing firms are more concerned about their status and, therefore, focus on the quality of the financial disclosure.

5. Return on Equity

Return on equity is another essential factor for better financial disclosure. It helps measure a firm’s proficiency in handling the shareholders’ money, which they invested in the company. Such companies will also generate more capital at the lowest price. 

6. Foreign ownership:

Foreign ownership refers to foreign direct investment in the country. When a business is owned and controlled by people who are not citizens of that country, it is certainly related to information disclosure in accounting statements. A good finance consulting firm will collaborate closely with their clients, assisting them in minimizing risks and also seizing opportunities.

7. Financial Leverage:

It implies using borrowed money to finance the assets. Therefore, companies with high financial leverage must disclose such information to confirm the loan amount, future plans, and business partners, etc. 

Why choose us?

Komplytek, deliver illustrious Finance and Accounting outsourcing services to enhance and assist the complete finance and accounting function. Our prior aim is to reduce the operative expenses, provide high-quality service within a quick turnaround time, and set standards for grander corporate regulation and compliance. We also set up a user-friendly accounting system on widely used accounting software that will assist your company’s finance program and delineate financial strategy.

 

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