A CENTRALISED ELECTRONIC ACCOUNTING
MODEL
A. THE BASIC ACCOUNTING MODEL
This concept involves a centralised accounting system that simplifies book keeping by making the process electronic. It will use existing technology with the addition of a custom designed accounting program.
The accounting system will operate in a similar manner to that set out below -
1. An electronic keycard (the accounts card) is issued to, or bought by, the principal/s of the business - this term refers to an individual/s, partnership or company. An electronic Personal Identification Number (PIN) or password will be electronically 'fingerprinted' on the magnetic strip on the back. Depending on the purpose of the accounts card, it will have some or all of these features on the front, in addition to the name of the accounts card system and the expiry date -
* a number
* the business name
* the signature of the card user - more than one person can be issued with a card for the account
* the address
* a photograph
2. When the accounts card holder makes a purchase the supplier enters the details onto the computer. The accounts card will be swiped through a swipe machine connected to the computer, the goods are paid for and a receipt issued to the purchaser as a copy of the transaction.
3. The information is transmitted electronically to the Accounts Transaction Centre where the transaction is recorded on both the suppliers and purchaser's accounts. The supplier's entry will appear as a credit on their account statement and the purchaser's entry will appear as a debit.
4. Businesses without access to a swipe machine can transmit the transaction via the Internet website to the control centre. Businesses without access to a computer can manually issue a receipt, including the tax paid, to the purchaser and post a duplicate to the Accounts Transaction centre.
5. Accounts card holders can download their account statement from the Internet at any time using their PIN or password, however the account statement can be posted at the end of the month if requested. B. THE ACCOUNTING MODEL USED AS A TAX RECORDING
SYSTEM
This concept is ideal as a tax recording system in any country where the items purchased -
* will be declared when preparing the annual tax return
* are subject to a Goods and Services Tax or Value Added Tax that the business collects/pays.
1. The Accounts card number could be the business taxation number (or business number).
2. The tax paid on each item is recorded at the point of sale in addition to the other details of the purchase. The supplier's account statement will have the entry in the Sales section showing the tax received on the item and the purchaser's account statement will have the entry in the Purchases section showing the tax paid on that item.
3. Items that are tax deductible for that business can be electronically 'tagged' at the point of sale and will be recorded in the relevant section on the taxation statement.
4. If the tax is paid monthly, the account will show all the sales and purchases made, the total tax received and paid that month and the difference will be the net amount of tax to be paid or to be refunded, whichever the case may be. (See Figures 1 - an Example of a Monthly Statement). When the tax is to be paid quarterly, a cumulative total of tax paid and received over the three months will be shown and a quarterly account prepared from that information.
5. The account is prepared on a customised form by the Accounts Transaction Centre and is forwarded to the Taxation Office of that country. Alternatively, any manual adjustments to this form can be made by the supplier and purchaser if the details where not sent to the Accounts Transaction Centre (in the situation in A4) when the accounts card with the taxation/business number could not be used and/or the supplier issued a manual tax invoice.