1. What Are Books of Accounts?
Books of accounts are records of financial transactions carried out by a company. They help track income, expenses, assets, liabilities, and equity.

2. Legal Requirement in India
Under Section 128 of the Companies Act, 2013, every company must maintain proper books of accounts at its registered office. These must reflect a true and fair view of the company’s affairs.

3. Key Books and Records to Maintain
Journal – Chronological record of all transactions.

Ledger – Classifies transactions under accounts.

Cash Book – Records cash receipts and payments.

Sales and Purchase Register – Tracks invoices and payments.

Bank Book – Tracks all bank transactions.

Inventory Register – Records details of stock/inventory.

Fixed Asset Register – Details of company-owned assets.

Payroll Records – Salaries, EPF, ESI, TDS on salaries.

4. Method of Accounting
Accrual Basis (mandatory for companies) or Cash Basis (only for certain small businesses).

Must be double-entry accounting.

5. Duration for Record Keeping
Companies must preserve books for at least 8 years.

6. Digital vs Physical Books
Books can be maintained in physical or electronic form (must be accessible and readable). Digital records are allowed if properly backed up.