External accounting

Basics

In external financial accounting, an external provider takes over tasks of ongoing bookkeeping, such as the recording of business transactions, Account assignment, creation of Booking entries and account reconciliations.

The responsibility for providing complete and accurate documentation remains with the company.

Legal framework

The performance of ongoing bookkeeping work is regulated by law. External service providers may only perform activities within the permissible scope. Tax advice or legal representation is regulated separately.

Systematic classification

• Financial accounting
• Accounting Services
• Accounting firm
• Double-entry bookkeeping
• Prepare year-end accounts

External financial accounting is organisationally part of a company's external accounting.

Typical areas of responsibility

• Recording and booking of business transactions
• Reconciliation of debtor and creditor accounts
• Maintenance of ledgers
• Preparation of business evaluations
• Assistance with preparatory final works

Typical procedure

1. Provision of accounting records
2. Recording and accounting
3. System Entry
4. Voting and plausibility check
5. Provision of evaluations

Practical relevance

In practice, external financial accounting often takes place in close coordination between companies, service providers, and, if applicable, a tax advisor. Clear responsibilities and documented processes are organisationally essential.

Typical sources of error

FAQ

Conclusion

External financial accounting is the organisational outsourcing of ongoing bookkeeping tasks to an external service provider. It must be clearly distinguished from tax advice and is structurally part of external accounting.