Housing Society Its Books Of Accounts

Housing Society Its Books Of Accounts

• Category: Economy
• Date 12-05-2025

Housing Society Its Books Of Accounts

1. Housing Society Books of Accounts: What Are They?

The term “books of accounts” in a housing society refers to the complete set of financial records that document every monetary transaction of the society. These records help ensure transparency, accountability, and financial discipline. They are used by the managing committee to plan budgets, monitor expenses, and satisfy regulatory and audit requirements. Key documents typically include:

• Journals and Ledgers: Daily recordings of receipts, payments, and all financial transactions.

• Cash Books and Bank Books: Detailed records of cash inflows/outflows and bank transactions including deposits, withdrawals, and reconciliations.

• Receipts and Payment Vouchers: Supporting documents for every transaction, ensuring each income or expense is duly recorded.

• Pass Books/Bank Statements: Provided by banks to verify entries in the society’s cash or bank books.

• Annual Financial Statements: These include profit and loss accounts, balance sheets, and budgetary reports.

• Registers of Dues and Advances: Detailing contributions, maintenance charges, fines, or any advance receipts from members.

• Other Supporting Documentation: Invoices, contracts, bills, and any correspondence related to financial transactions.

2. Requirement and Necessity

Proper maintenance of books of accounts is not only a good financial practice but also a legal necessity. Here’s why they are essential:

• Transparency and Accountability: All members have the right to know how their money is being managed. Detailed records build trust within the society.

• Legal Compliance: Most jurisdictions require societies to maintain accurate financial records under housing society or cooperative laws. Non-compliance can lead to legal penalties or administrative actions.

• Facilitating Audits: Accurate and detailed books support internal and external audits. Auditors rely on these documents to verify that financial statements represent the society’s true position.

• Financial Management and Planning: Well-maintained books provide critical information for budgeting, forecasting, and decision-making.

• Dispute Resolution: In cases of financial discrepancies or disputes among members, proper records provide evidence to resolve issues.

3. Roles, Responsibilities, and Guidelines

A. Managing Committee

The managing committee (or governing body) is central to the society’s administration. Their responsibilities with regard to maintaining books of accounts include:

• What to Do:

  • Ensure Timely Recording: Oversee that all transactions are recorded promptly and accurately.

  • Compliance Checks: Regularly review the books to ensure they meet legal and regulatory standards.

  • Budgeting and Financial Planning: Use the records to prepare annual budgets and monitor expenditures.

  • Decision Making: Use the financial data to make informed decisions regarding maintenance, repairs, and future investments.

  • Transparency: Make the financial records available to members during meetings and upon request.

  • Periodic Review: Schedule regular internal audits and reviews of the accounts.

• What Not to Do:

  • Neglect Documentation: Avoid delays in recording transactions or preserving supporting documents.

  • Manipulate Data: Do not alter or manipulate records to obscure financial irregularities.

  • Lapse in Accountability: Avoid withholding financial information from society members.

  • Irregular Meetings: Do not postpone regular meetings that review the financial status of the society.

B. Society Members

While members may not directly handle the books, their active participation and oversight are crucial:

• What to Do:

  • Stay Informed: Regularly review the disclosed financial statements and raise queries if discrepancies are noted.

  • Attend Meetings: Participate in general body meetings where financial reports are discussed.

  • Exercise Voting Rights: Vote on major financial decisions, such as budgets and additional levies.

  • Keep Records of Contributions: Maintain personal records of all payments made to the society for cross-verification.

• What Not to Do:

  • Disregard Transparency: Do not ignore or bypass the financial disclosures made by the managing committee.

  • Spread Misinformation: Avoid making claims about financial mismanagement without verifying against the official records.

  • Interfere with Auditor Work: While it is important to be involved, do not pressure or compromise the independence of the auditor.

C. The Accountant

The accountant is responsible for day-to-day financial record-keeping. Their performance and integrity are pivotal in ensuring trustworthy accounts.

• What to Do:

  • Accurate Recording: Maintain meticulous records for every transaction in accordance with accepted accounting practices.

  • Timely Reconciliation: Regularly reconcile cash and bank statements with ledger entries.

  • Adherence to Standards: Ensure compliance with statutory accounting standards and any sector-specific guidelines.

  • Document Preservation: Keep all supporting documents (receipts, vouchers, invoices) organized and readily available.

  • Transparency in Reporting: Provide periodic, clear financial reports to the managing committee and, ultimately, to the members.

• What Not to Do:

  • Delay Entries: Avoid postponing the recording of transactions, which can lead to errors.

  • Lapse in Documentation: Do not lose or misfile supporting documents that verify financial entries.

  • Collude in Discrepancies: Do not engage in practices that can lead to intentional misrepresentation of financial data.

  • Non-compliance: Avoid any deviation from statutory requirements or internal policies which could lead to legal issues.

D. The Auditor

An external auditor (or sometimes an internal auditor) verifies the accuracy and fairness of the society’s books of accounts. Their role is to ensure completeness, correctness, and transparency.

• What to Check:

  • Compliance with Regulations: Verify that the records adhere to relevant legal and statutory requirements.

  • Accuracy of Transactions: Ensure that every entry in the books is supported by proper documentation.

  • Asset Verification: Check physical assets and bank balances, comparing them with the recorded amounts.

  • Internal Controls: Review if proper internal controls are in place to prevent fraud or errors.

  • Budget vs. Actuals: Examine variances between the budgeted figures and actual performance to spot any irregularities.

  • Timeliness and Consistency: Confirm that books have been updated regularly and consistently throughout the period.

• What Not to Check/Do:

  • Assume Honesty: Do not take the records at face value without validating through independent means.

  • Overstep Boundaries: Avoid interfering in day-to-day management decisions; their role is to review and report, not manage.

  • Neglect Follow-up: Do not ignore discrepancies or anomalies; every inconsistency should lead to further investigation.

  • Accept Incomplete Data: Avoid issuing a clean opinion if substantial records or documents are missing or incomplete.

E. Registrar and Compliance Necessity

The registrar (often part of a government or regulatory body) oversees statutory compliance of housing societies. Their role is to ensure the society is operating within the legal framework.

• Compliance Requirements:

  • Timely Filing of Accounts: Societies are required to submit annual financial statements, audit reports, and other compliance documents as mandated by laws (such as the Cooperative Societies Act or local housing society regulations).

  • Transparency Norms: Ensure that the society’s records are open for inspection by members and regulatory officials.

  • Adherence to Legal Provisions: The society must adhere to prescribed accounting standards and maintain a standard format of books as dictated by the law.

  • Regular Audits: Mandate regular audits (both internal and external) and review of accounts to prevent any financial mismanagement.

• Registrar's Checks:

  • Review of Financial Documents: Ensure that all submitted documents are complete, properly organized, and accurate.

  • Compliance with Statutory Requirements: Verify that the society follows all mandatory provisions related to financial disclosure and member communications.

  • Penalties for Lapses: Note that failure to maintain and submit accurate books may result in penalties or corrective directives from the registrar.

4. Summary and Best Practices

• Overall Best Practices:

  • Maintain Detailed Records: All transactions should be documented with the corresponding support.

  • Regular Audits and Reviews: Implement both periodic internal reviews and external audits.

  • Clear Communication: All financial information should be communicated transparently to society members.

  • Compliance and Up-to-date Practices: Keep current with any changes in legal requirements or accounting standards.

  • Training and Awareness: Train the managing committee and staff in proper record-keeping and regulatory requirements to ensure that everyone understands their obligations.

By following these guidelines and responsibilities, a housing society can ensure that its financial management is both efficient and legally compliant. This ultimately fosters trust among the members and contributes to a well-managed community.

======================================================================================

1. Books of Accounts in a Housing Society

The books of accounts in a housing society typically include the following documents:

a. Cash Book

• What it is: A record of all cash transactions, both receipts and payments, that happen within the society.

• Requirement: Essential for tracking day-to-day cash transactions.

b. Bank Book

• What it is: A record of all bank transactions, including deposits, withdrawals, and bank charges.

• Requirement: Necessary for reconciling the bank balance with the actual balance in the society’s accounts.

c. General Ledger

• What it is: A complete record of all financial transactions of the society, categorized by account heads (e.g., income, expenditure, capital, liabilities).

• Requirement: Essential for preparing final accounts like the balance sheet and profit-and-loss statement.

d. Income and Expenditure Account

• What it is: A summary of the income and expenditures of the society, showing the profit or loss for a specific period.

• Requirement: Required for assessing the financial performance and for compliance with legal regulations.

e. Balance Sheet

• What it is: A statement of the society’s assets and liabilities at the end of the financial year.

• Requirement: Mandatory for assessing the financial health of the society and for statutory compliance.

f. Receipt and Payment Register

• What it is: A record of all receipts (from members, interest, other income) and payments (for services, maintenance, etc.).

• Requirement: Important for tracking all incoming and outgoing cash flows.

g. Fixed Asset Register

• What it is: A detailed record of the society's fixed assets (e.g., land, building, equipment), including their purchase cost, depreciation, and current value.

• Requirement: Necessary for managing and tracking assets and their maintenance.

h. Members’ Ledger

• What it is: A record of the dues and payments made by individual members, including maintenance charges, penalties, etc.

• Requirement: Critical for tracking the financial status of each member.

i. Annual Report

• What it is: A report summarizing the society’s financial performance and activities for the year.

• Requirement: Mandatory for the Annual General Meeting (AGM) to provide transparency to members.

2. Managing Committee Responsibilities

The managing committee has several critical duties related to financial management:

What they should do:

• Ensure Accurate Record-Keeping: Ensure that all transactions are recorded in the appropriate books of accounts.

• Approving Financial Statements: The committee must approve the society's financial statements before they are presented to the members in the AGM.

• Auditing and Transparency: Ensure that the financial records are audited regularly by a qualified auditor.

• Budgeting and Financial Planning: Prepare and approve a budget for the society’s finances for the upcoming year.

• Compliance: Ensure that the society complies with all applicable laws, including tax filings, returns, and statutory requirements.

• Regular Meetings: Hold regular meetings to review the financial situation and make decisions about the society’s finances.

What they should NOT do:

• Misuse Funds: They should not use society funds for personal benefits or non-society-related activities.

• Bypass Legal Procedures: They must not bypass the proper procedures for financial decisions or ignore the requirements of the audit and compliance.

• Neglect Maintenance of Books: They should not ignore the need for regular and accurate record-keeping of financial transactions.

3. Member Responsibilities

Members also have a role in ensuring the financial health of the society:

What they should do:

• Pay Dues on Time: Members must pay maintenance charges and other dues promptly.

• Attend AGMs: Attend Annual General Meetings to stay informed about the society's financial health and participate in decision-making.

• Raise Concerns: Members can raise any concerns about financial mismanagement or irregularities, but they must do so through the proper channels.

What they should NOT do:

• Avoid Payment of Dues: Not paying dues or failing to contribute to society funds may lead to financial difficulties for the society.

• Interfere with Management: Members should not interfere in day-to-day financial management, but should follow the proper channels for raising concerns.

4. Accountant Responsibilities

An accountant plays a crucial role in maintaining the financial records of the society:

What they should do:

• Maintain Accurate Records: Keep detailed and accurate records of all financial transactions.

• Prepare Financial Statements: Prepare monthly or quarterly financial reports, income-expenditure statements, and balance sheets for the committee.

• Reconcile Accounts: Ensure that all bank statements and cash books are reconciled with the actual society’s accounts.

• Assist in Budgeting: Help the managing committee in preparing budgets and forecasting financial needs.

What they should NOT do:

• Engage in Fraudulent Practices: They must not misrepresent or manipulate financial data.

• Neglect Compliance: The accountant should ensure that statutory returns (GST, tax filings, etc.) are filed on time.

• Ignore Financial Audits: They must not delay the audit process or fail to maintain the financial documents for audit purposes.

5. Auditor Responsibilities

The auditor plays an essential role in ensuring financial integrity:

What they should do:

• Audit Financial Statements: The auditor should review and verify all financial documents, including cash books, bank statements, and the balance sheet.

• Report Irregularities: If any discrepancies or fraud are found, the auditor must report them to the managing committee and suggest corrective actions.

• Ensure Compliance: Check that the society is complying with all tax regulations, including GST and income tax filings.

• Provide a True & Fair View: The auditor must ensure that the financial statements provide a true and fair view of the society’s financial status.

What they should NOT do:

• Overlook Errors: The auditor should not ignore or overlook significant errors in the financial records.

• Fail to Follow Regulations: They must not deviate from auditing standards or legal requirements.

• Engage in Conflict of Interest: Auditors must remain independent and should not have any conflicts of interest with the society.

6. Registrar Compliance

The registrar plays a vital role in ensuring that the society adheres to the law:

What they check:

• Compliance with Legal Provisions: The registrar ensures that the society follows legal and statutory requirements under the Maharashtra Cooperative Societies Act, 1960.

• Document Submission: The registrar may require the society to submit annual reports, audited financial statements, and returns on time.

• Regular Inspections: They conduct inspections to ensure that the society is operating within the legal framework and adhering to its bye-laws.

• Member Registration: The registrar ensures that all member records are accurately maintained.

What they do NOT check:

• Daily Transactions: The registrar does not check every transaction but focuses on overall compliance with the law.

• Internal Disputes: While the registrar may handle certain disputes, they do not intervene in day-to-day management issues unless there's a legal breach.

Conclusion

Proper maintenance of books of accounts is crucial for the smooth functioning of a housing society. Compliance with the Maharashtra Cooperative Societies Act, 1960, and other relevant regulations is necessary to avoid legal complications and ensure that all financial dealings are transparent and accurately recorded. Everyone—from the managing committee to the auditor—has specific roles and responsibilities to maintain financial integrity and legal compliance.

======================================================================================

Top Software for Housing Society Accounting

1. Webacc Solution - Society Management

• Type: Cloud-based

• Key Features:

  • Accounting with automated maintenance billing, receipts, and ledgers

  • GST compliant invoicing

  • Vendor and expense management

  • Online payments via UPI, credit cards, net banking, Through QR code Scan, Bank Transfer

  • Auto reconciliation of bank transactions

  • Audit reports, balance sheet, and income/expense statements

• Pros: Society management, mobile app for members

• Cons: Best for small as well as big societies

• Best For: Small, Medium to large societies wanting a full society + accounting suite

2. ApnaComplex

• Type: Cloud-based

• Key Features:

  • Accounting with automated maintenance billing, receipts, and ledgers

  • GST compliant invoicing

  • Vendor and expense management

  • Online payments via UPI, credit cards, net banking

  • Auto reconciliation of bank transactions

  • Audit reports, balance sheet, and income/expense statements

• Pros: All-in-one society management, mobile app for members

• Cons: Paid plans can be expensive for small societies

• Best For: Medium to large societies wanting a full society + accounting suite

---

3. Society123 by Lodha Group

• Type: Cloud-based

• Key Features:

  • Fully automated accounting and financial reports

  • Member communication tools (email/SMS notifications)

  • Complaint tracking, notice board

  • Budgeting and audit-ready financial statements

• Pros: Reliable and designed specifically for Indian societies

• Cons: Limited third-party integrations

• Best For: Societies with Lodha ties or those looking for simple, secure tools

---

4. SocietyRun

• Type: Cloud-based

• Key Features:

  • Automatic billing & ledger entries

  • Expense and voucher tracking

  • Income/expenditure statements and balance sheet

  • Reminder system for dues

• Pros: User-friendly interface, affordable for smaller societies

• Cons: Less suited for very large complexes with 500+ units

• Best For: Small to mid-size societies

---

5. Smart Society by Excelon

• Type: Cloud-based

• Key Features:

  • Advanced accounting tools (double-entry, ledger, P&L, balance sheet)

  • Customizable maintenance charges

  • SMS/email integration

  • Audit reports and TDS compliance

• Pros: Strong accounting depth, reports for auditors

• Cons: UI could be more modern

• Best For: Societies with accountant involvement or audit-heavy setups

---

6. Housing Society Accounting Software (Offline – Tally Customization)

• Type: Offline / Desktop-based (using Tally ERP 9 / Tally Prime with customization)

• Key Features:

  • Custom charts of accounts for housing societies

  • Maintenance billing, receipts, advance adjustments

  • Audit-friendly reports

• Pros: Reliable and widely used in accounting

• Cons: Requires professional setup and trained accountant

• Best For: Societies that prefer in-house, offline control and already use Tally

---

Key Considerations When Choosing Software

Factor	Recommendation
Society Size	Cloud-based tools like Webacc Solution - Society Management scale better
Accounting Depth	Webacc Solution - Society Management, Smart Society, Tally customization
Audit Compliance	Software with clear audit logs and reports
Mobile Access	Apps like Society Management, ApnaComplex or MyGate (with add-on accounting)
Budget Constraints	Webacc Solution, SocietyRun or Smart Society (cost-effective)
GST or TDS Handling	Go for Webacc Solution, Tally or Smart Society with statutory compliance support

===========================================================================

 ????Solution????

Contact us on 9136050062, we have each and every solution of Housing Society problems…..

Thank you friends

Last updated: 12/05/2025

HOUSING SOCIETY ONLINE ACCOUNTS & MOBILE APP

Visit our Website : https://webaccsolution.com

Visit our Android Mobile App : https://play.google.com/store/apps/details?id=com.societymanagement.society_management&pcampaignid=web_share

Visit our Business Plan Website (For our Registered Members Only) : https://webaccsolution.in