Branch Accounting and its need
Branch accounting Q. What is a branch? A. A branch may be defined as a section of an enterprise, geographically separated from the rest of the business, controlled by a head office, and generally carrying on the same activities as of the enterprise. A branch is not a separate legal entity, it is simply a segment of a business. Q. What is branch accounting? A. Branch accounting is a bookkeeping or accounting system in which separate accounts are maintained for each branch or operating location of an organisation that allows geographically dispersed corporations, multinationals and chain operators, to keep track of financial transactions at each branch individually and also to consolidate the same at the main branch or head office. It allows greater transparency in the transactions, cash flows, and overall financial position and performance of each branch. Q. Why is branch accounting needed? A. An enterprise sets up its branches at different geographical locations to penetrat...