What Does a Branch Office Manager Do?
A branch is a type of permanent establishment. The dispatching agency that does not have an independent legal person status under the head office belongs to the same legal entity as the head office. Its production, sales, finance, and personnel are subject to the control and control of the head office. The branch is established in a foreign country to engage in production and business activities, and the government of the host country provides it with tax treatment for non-resident companies. The income tax it pays abroad is granted by the government of the country where the head office is located as a tax credit. [1]
Branches
- The difference between a branch and a sales agency is mainly reflected in the autonomy of operation. The sales agency usually does not directly distribute products, everything is subject to the arrangements of the headquarters and does not have independent operation autonomy. Branches can independently engage in the purchase and sale of goods, and have more operating autonomy than sales agencies. However, when the branch only accounts for cash receipts and payments, and the sales, purchases, and collections are all under the unified accounting of the headquarters, it is not much different from the sales agency.
- Most branches are independent accounting entities with independent accounting records and reporting systems. They usually need to set up a relatively complete set of books to record their own economic operations, to separately calculate financial conditions and operating results, to prepare accounting statements on a regular basis, and to report to headquarters. However, the name and number of the branch's accounting subjects, the content and format of the accounting statements, internal control systems and accounting policies, etc., are generally prescribed in advance by the headquarters.
Branch settings
- As a branch of an accounting entity, it is often necessary to set up a set of books to record the working capital and commodity inventory received from the company's headquarters, as well as external purchases, sales, accounts payable, accounts receivable, Expenses, etc., and regularly prepare accounting statements and report to the company headquarters. The names and numbers of accounting subjects, the content and format of accounting statements, internal control systems and accounting policies are generally prescribed in advance by the company's headquarters. The accounting matters that should be accounted for by the branch should be the various assets, liabilities, income and expenses that the branch manager can control and can therefore be responsible for, such as accounts receivable and sales expenses.
- As for the various assets, liabilities, income and expenses that the branch manager cannot control, such as fixed assets and depreciation expenses, they are often concentrated at the company headquarters for accounting and management.
- When setting up a branch, it should be recorded in the company's headquarters and branch accounts. A branch company account should be set up in the branch account. When receiving cash, merchandise inventory, or other assets from the headquarters, the account will be credited, and cash, merchandise inventory, or other assets will be returned to the headquarters. At that time, the account is debited, and at each settlement, the net income or net loss obtained by the branch is transferred to the lender or debit of the account.
- A corresponding account branch transactions should be set up in the company's headquarters account. The debit of this account records all cash, commodity inventory, or other assets allocated to the branch, and the lender records cash, commodity inventory, and other cash allocated by the branch. Assets: At each closing, the company's headquarters will record its net income or net loss in the account's debit or lender based on the financial statements reported by the branch. If an enterprise has many branches, the company headquarters can set up a control account, and then set a detailed account for each branch under the control account. The accounting content of these two accounts can be listed as follows:
- Branches
Branch company headquarters
- Branches
- Assets transferred to branches Assets received from branches
- Net income of branches Net loss of branches
Branch account
- Headquarters exchanges
- Assets transferred to corporate headquarters Assets received from corporate headquarters
- Net loss of branches Net income of branches
- It can be seen that the contents of the above two account records are the same, but the directions are opposite. From the standpoint of the branch, the "headquarters transactions" can be regarded as both an owner's equity account and a liability account; from the standpoint of the company's headquarters, the "branch transactions" can be regarded as both long-term investment accounts and Accounts receivable. If both accounts are booked in a timely manner, their balances should be consistent. Since the branch
- Branches
- In most cases, the merchandise inventory of a branch is often purchased centrally by the company's headquarters and then delivered to the branch. In some cases, the company's headquarters also authorized branches to purchase some merchandise inventory. When a branch purchases part of the goods inventory, its accounting process is the same as the general accounting for the purchase and sale of goods. When the company's headquarters purchases the merchandise inventory and then sends it to the branch for sale, the merchandise inventory sent to the branch can be priced at cost, or it can be priced at higher than cost, that is, cost plus or retail price. The difference in valuation methods will affect the amount of goods inventories posted to branches and affect the process of compiling financial statements. The company's headquarters and branches can use either the periodic inventory system or the perpetual inventory system for the accounting of merchandise inventory. If the periodic inventory system is adopted, an account of "delivering inventory at the branch" should be set up on the company's headquarters account, which is an allowance account for the "purchase" account, and an account of "inventory from the company headquarters" should be set up on the branch This account is essentially a "company headquarters purchase" account for a branch. Since these two accounts are relative, they should be offset when compiling the financial statements. If the perpetual inventory system is adopted, for the transaction of transferring the goods inventory between the company's headquarters and branches, the relevant inventory account can be directly recorded, and there is no need to set up the above corresponding account.
Notes for branches
- 1. The branch does not have registered capital, and needs to be noted in the registration information section, such as "The target company is a limited company branch without registered capital, and its parent company is: **** Limited Company.";
- 2. The legal representative is also generally called the person in charge in the branch;
- 3. The branch has no shareholders, which corresponds to the head office, which must be accurately described when describing the business;
- 4. Branches are also non-independent legal persons. They do not have the status of corporate legal persons, and generally do not have independent financial accounting departments, but there are exceptions, such as Shenyang Machine Tool Co., Ltd. Zhongjie Drilling and Boring Machine Factory.