Accounts from Incomplete Records

and needs, and their accounts are not comparable due to lack of uniformity. (e) To ascertain profit or loss or for obtaining any other information, necessary figures can be collected only from the original vouchers such as sales invoice or purchase invoice, etc. Thus, dependence on original vouchers is inevitable. (f) The profit or loss for the year cannot be ascertained under this system with high degree of accuracy as only an estimate of the profit earned or loss incurred can be made.

The balance sheet also may not reflect the complete and true position of assets and liabilities. . Reasons of Incompleteness and its Limitations It is observed, that many businessmen keep incomplete records because of (a) This system can be adopted by people who do not have the proper knowledge of accounting principles; (b) It is an inexpensive mode of maintaining records. Cost involved is low as specialised accountants are not appointed by the organisations; (c) Time consumed in maintaining records is less as only a few books are maintained; (d) It is a convenient mode of maintaining records as the owner may record only important transactions according to the need of the business.

However, the mechanism of incomplete records suffers from a number of