Importance or Objectives or Advantages of Subsidiary Books

1. Saving of Time and Labor: If all the transactions of similar nature are recorded together in a separate book, a considerable amount of labor and time can be saved. There is no need of preparing journal for each transaction with its narration. In other hands, different subsidiary books may be prepared by different clerks so that all the transactions are entered in subsidiary immediately as they occur. For example, many credit purchases of all the day can be recorded in purchase book as a single entry.
2. Divisions of Works: Recording of transaction in subsidiary books can be performed by different clerk as per nature of subsidiary books. It means a person may be employed to record the purchase on credit whereas another may be for credit sales. Thus, it introduces the division of labor. Division of labor increases the work efficiency of labors. The working labors have the specialization on their job.
3. Quick Access to Information: Since the transactions relating to one particular head are recorded in a separate book, it is easy to get any type of information in detail.
4. Possibility of Internal Check: Different subsidiary books may be maintained by different clerks and the balance of a subsidiary book determined by a clerk also may be recorded by another clerks while posting into ledgers and preparing trial balance. Thus, error or fraud committed by one may be checked by another.

Subsidiary Book

Some transactions like credit purchase, credit sales, return of goods purchased, return of goods sold, bills receivable, bills payable, cash paid and received etc are occurred so many times in a day. To enter such repetitive transactions in a journal consumes more labor, time and money. When the business transactions are numerous, one person may not be able to maintain all the books of accounts himself. Recording of all the books of accounts himself. Recording of all transactions in a journal can not avail the classified information of a particular transaction, say information about purchase, information about sale etc. Thus, transactions relating to one particular head are recorded in a separate book. In other words, a separate book is maintained to record the similar transactions which are called "Subsidiary Books". It is also called as "Special Journals" or "Sub-Division of Journal" or "Day Book".

In the modern book-keeping, the repetitive or routine transactions are recorded in subsidiary books and the occasional transactions which occur in a long time interval are recorded in a general journal. Purchase Book, Sales Book, Sales Return Book, Purchase Return Book etc are some subsidiary books.

Kinds of Accounting System Used in Nepal

1. Shyaha: Shyaha is like as original records of the transactions. It can be compared with journal voucher of double entry system. Shyaha was useful to record government expenditures and incomes. Shyaha is prepared in English alphabet "T". A leaf was folded in 16, 24, 32 or 36 creases as per requirement of the office to record the different heads of expenses and revenues. On the right hand side of a Shyaha, all the expenses were recorded and all revenues on the left-hand side. At the close of the day, both sides of Shyaha are totaled and underlined which is called 'Terij'. Again, the grand total is found by adding to the total amount up to the previous day with current day's amount. It is called 'Berij'. A Shyaha was either closed at the end of each month or at the end of the fiscal year. Shyaha could be divided into following further three types;

• Nagadi Shyaha - prepared for cash transaction.
• Jinsi Shyaha - prepared for properties.
• Dharauti Shyaha - prepared to record the amount deposited by public.

2. Awarje: Awarje was another important book maintained under Shyaha Srestha Pranali. It was like ledger kept under double entry system. In this book, all the transactions were classified under different heads of revenues and expenditures. It was prepared on the basis of Shyaha. Awarje had the following categories:

• Income Awarje: It was prepared to record and classify the government revenues. Income Awarje were further classified into Regular Income Awarje and Irregular Income Awarje.
• Binjalik Awarje: It recorded and classified the government expenditures.

3. Dhapot: Dhapot can be compared with modern balance sheet. It presented summary of government financial position of a certain period. There were the following three types of Dhapot used in the Shyaha Srestha Pranali.

• Job End Dhapot: It was that kind of Dhapot which was prepared at the end of job or after the completion of project work.
• Month End Dhapot: It was prepared at the end of each month.
• Year End Dhapot: If the Dhapot was prepared at end of each fiscal year, it was called Year End Dhapot.
  

Kinds of Accounting System Used in Nepal

1. Wasil Banki Srestha Pranali: This is a simple book or statement of recording of government revenue and expenditure. It was suitable to those offices which were established for short period or which had a small number of financial transactions. It was based on single entry system where the revenues were recorded on one side of the page and expenditures on the other side. Therefore, it was easy to find the total amount of expenditures and incomes. Under this system, books are closed either at the end of the fiscal year or at the completion of work. This system was failed to analyze the transactions into a number of heads.
2. Shyaha Srestha Pranali: In the historical development of accounting in Nepal, Shyaha Sresta Pranali is an important system, which was found by Kharidar Gunawanta in about 1936 B.S. It was more systematic than Wasil Banki System. Under this system, both expenditures and revenues could be recorded on the same leaf and their total and balances also could be shown on the same leaf when required.