Accounting and Bookkeeping Services For Trading Business in Thailand
Ensuring a smooth and compliant process from start to finish.
Trading businesses in Thailand operate in a fast-moving environment, managing inventory, supplier relationships, invoices, and fluctuating costs.
Supporting Trading Businesses with Clarity and Compliance
Accounting for trading businesses involves a system specifically designed to record purchase and sale transactions of goods, along with other related activities. These include product returns, discounts received and given, and end-of-period inventory counts. The bookkeeping process in a trading business tends to be more complex than that of service-oriented businesses, due to the volume of transactions and the need for accurate inventory and cost tracking.
Partner with Experts in Trading Operations
With a deep understanding of Thailand’s commercial environment and accounting regulations.
Inventory and COGS Reconciliation
We help you keep track of inventory movements and match them with purchase and sales data to accurately calculate the cost of goods sold (COGS). This gives you a true view of your gross margins and profit structure.
Bookkeeping and Transaction Recording
We maintain organized and audit-ready ledgers by recording daily business transactions, including purchases, sales, returns, and discounts. Our team ensures every entry aligns with Thai accounting standards.
Accounts Payable & Receivable Management
Maintain complete visibility over outstanding receivables and payables. We help you manage due dates, vendor payments, and customer collections—preserving liquidity and improving operational efficiency.
Monthly and Annual Financial Reports
Receive comprehensive financial statements including balance sheets, profit & loss accounts, cash flow statements, and detailed trial balances. Our reporting supports internal decision-making and regulatory filing.
VAT, Withholding Tax, and Statutory Compliance
We prepare and file all required tax documentation—VAT returns (PP30), withholding tax filings (PND forms), and ensure timely submissions to the Revenue Department, minimizing risk and avoiding penalties.
Accounting and Bookkeeping Packages
With our all-in-one accounting and bookkeeping package, you get the tools, support, and expertise you need to keep your financial records accurate, organized, and compliant.
Acc Starter Package
1-30 Transactions per month-
1-30 Transactions per month
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Accounting Document Archiving
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Monthly Income Statement (PL)
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Statement of Financial Position (BS)
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Statement of Changes in Equity
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Monthly Fixed Asset Register
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Monthly General Ledger (GL)
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Monthly Trial Balance (TB)
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Accounts Receivable Aging Report
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Accounts Payable Aging Report
Acc Growth Package
31-60 Transactions per month-
31-60 Transactions per month
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Accounting document archiving
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Monthly Income Statement (PL)
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Statement of Financial Position (BS)
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Statement of Changes in Equity
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Monthly Fixed Asset Register
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Monthly General Ledger (GL)
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Monthly Trial Balance (TB)
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Accounts Receivable Aging Report
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Accounts Payable Aging Report
Acc Strategic Package
61-100 Transactions per month-
61-100 Transactions per month
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Accounting document archiving
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Monthly Income Statement (PL)
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Statement of Financial Position (BS)
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Statement of Changes in Equity
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Monthly Fixed Asset Register
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Monthly General Ledger (GL)
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Monthly Trial Balance (TB)
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Accounts Receivable Aging Report
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Accounts Payable Aging Report
Acc Executive Package
101-150 Transactions per month-
101-150 Transactions per month
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Accounting document archiving
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Monthly Income Statement (PL)
-
Statement of Financial Position (BS)
-
Statement of Changes in Equity
-
Monthly Fixed Asset Register
-
Monthly General Ledger (GL)
-
Monthly Trial Balance (TB)
-
Accounts Receivable Aging Report
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Accounts Payable Aging Report
Inventory Accounting Systems for Trading Businesses
In trading businesses, inventory accounting plays a crucial role in accurately reflecting cost of goods sold and ending inventory. There are two primary methods used to record inventory in accounting systems
Perpetual Inventory Method
This method involves continuous tracking of inventory. Every purchase and sale of goods is recorded in real time, and the inventory balance is updated with each transaction. Businesses can view inventory levels and cost of goods sold (COGS) at any time without waiting for a physical count.
Periodic Inventory Method
Under this method, inventory records are updated at the end of an accounting period. Throughout the period, purchases and sales are recorded separately, but inventory and COGS are only determined after a physical stock count is conducted at period-end. The COGS is calculated using the formula:
COGS = Beginning Inventory + Purchases – Ending Inventory
In both systems, two key accounts are used:
Inventory Account – to track the value of goods held at the end of the period
Cost of Goods Sold (COGS) Account – to reflect the cost of items sold during the period
The choice of method depends on the nature of the business, transaction volume, and the need for real-time inventory data.
Revenue of a Trading Business
The primary source of revenue for a trading business comes from selling goods that are purchased for resale. However, a company may also generate income from other sources that are not directly related to its main trading activities.
This refers to income earned from the business’s core operations—specifically, the sale of goods. It is the most consistent and recurring type of revenue and directly reflects the company’s main commercial activities.
Examples of operating revenue include:
Sale of gold or precious metals
Sale of petroleum products or fuel
Sale of gemstones or jewelry
Sale of dietary supplements
Sale of automotive parts
Sale of cars and motorcycles
These are all considered regular revenue streams and are used to assess the financial performance of a business’s primary operations.
This type of income is not derived from the business’s principal trading activities. It is usually irregular and non-recurring, and may only appear in certain accounting periods. While not the core focus of the business, non-operating income still contributes to overall profitability.
Examples of non-operating revenue include:
Income from additional services rendered
Dividend income from investments
Interest income from savings or deposits
Rental income from leasing out property or equipment
Income from the sale of fixed assets
Gains or losses from foreign exchange rate differences
Understanding Trade Terms: FOB and CIF in Accounting
When dealing with international and domestic trade, it’s essential to understand delivery terms, as they determine when ownership transfers, who bears shipping costs, and how freight expenses should be recorded in your accounting books.
FOB Shipping Point
(Free on Board at the Shipping Point)
Under FOB Shipping Point terms, the buyer assumes ownership and responsibility for the goods as soon as the seller delivers them to the shipping carrier at the point of origin.
Shipping Costs: The buyer pays for all freight charges.
Ownership Transfer: Ownership passes to the buyer at the seller’s shipping location.
Accounting Treatment: The buyer records the shipping expense as Freight-In, which becomes part of the cost of goods purchased or inventory value.
Example: If a trading company in Thailand purchases goods FOB Shipping Point from a supplier in Japan, the Thai company bears the freight costs and assumes responsibility once the goods are shipped.
FOB Destination
With FOB Destination terms, the seller retains ownership and responsibility for the goods until they arrive at the buyer’s location.
Shipping Costs: The seller covers the freight charges.
Ownership Transfer: Ownership passes to the buyer only when the goods reach the destination.
Accounting Treatment: The seller records the freight expense as Freight-Out, classified as a selling or distribution expense.
Example: A Thai wholesaler selling goods to a customer in Singapore under FOB Destination would remain responsible for the goods and delivery costs until they reach the customer’s warehouse.
CIF
(Cost, Insurance, and Freight)
CIF is a commonly used international trade term where the seller includes the cost of goods, insurance, and freight in the quoted price.
Shipping Costs: Already included in the total invoice price paid by the buyer.
Ownership Transfer: Usually defined in the agreement, but typically the seller bears the responsibility until the goods reach the named port of destination.
Accounting Treatment: The buyer does not separately record freight or insurance costs, as they are embedded in the purchase price. However, these must be clearly understood for customs declarations and tax purposes.
Example: If goods are sold CIF Bangkok Port, the seller is responsible for the cost, insurance, and freight up to the port in Thailand. The buyer only takes over once the goods have arrived.
| Trade Term | Who Pays for Shipping | When Ownership Transfers | Accounting Entry |
|---|---|---|---|
| FOB Shipping Point | Buyer | At point of shipment | Buyer: Freight-In (Inventory) |
| FOB Destination | Seller | At point of delivery | Seller: Freight-Out (Expense) |
| CIF | Seller (included) | Typically at destination port | Buyer: Cost embedded in purchase price |
Key Accounting Items in a Trading Business
Trading businesses involve various accounting entries beyond simple sales and purchases. To ensure accurate financial records, tax compliance, and decision-making, business owners must understand the transactions related to returns, discounts, credit terms, and freight costs. Here’s a breakdown of the key concepts:
Purchase Returns and Allowances
Sometimes, goods received from a supplier may not meet the agreed-upon specifications—due to incorrect types, quantities, or quality issues. In such cases, the buyer may return the goods, known as a Purchase Return.
In other cases, instead of returning goods, the buyer may choose to keep them and request a purchase allowance (a reduction in price due to defects or discrepancies).
The buyer issues a formal request, usually in the form of a Debit Note (Debit Memorandum), specifying the amount to be returned or reduced and the reason.
If the seller agrees, they issue a Credit Note, which also serves as a VAT document, to confirm the price adjustment.
These documents are essential for proper bookkeeping and tax filing.
Trade Discounts
Trade discounts are reductions in price offered by the seller to encourage bulk purchases. These discounts are reflected directly in the invoice and are not recorded separately in the accounting records.
For example, a wholesaler might sell an item at 200 THB/unit with a 30% trade discount to retail stores purchasing 10 units or more.
The invoice will show only the net price after discount—no separate accounting entry is needed.
Trade discounts make it easier for sellers to adjust pricing strategies without reprinting full price lists.
Cash Discounts (Early Payment Discounts)
Cash discounts are incentives offered to encourage prompt payment on credit purchases. These are recorded in the accounts and reflected in the seller’s and buyer’s books.
The buyer records this as Purchase Discount (Discount Received), reducing the total purchase cost.
The seller records this as Sales Discount (Discount Allowed), reducing total revenue.
Example Credit Terms:
2/10, n/30: 2% discount if payment is made within 10 days; otherwise, full payment is due within 30 days.
2/EOM, n/60: 2% discount if paid within the same month of purchase; full payment due in 60 days.
2/10 Prox, n/60: 2% discount if paid by the 10th of the following month; full payment due in 60 days.
These terms vary based on the business or product type.
Debt Settlement and Trade Credit
Trading businesses often operate on a credit basis. The buyer does not pay at the point of delivery but agrees to pay within a certain period, known as trade credit.
Accounts Payable (AP): The buyer records the obligation to pay the supplier.
Accounts Receivable (AR): The seller records the amount expected to be received from the customer.
Proper tracking of these accounts is critical for managing cash flow and ensuring timely collections or payments.
| Transaction Type | Buyer’s Entry | Seller’s Entry |
|---|---|---|
| Purchase Return | Reduces Purchases | Reduces Sales |
| Purchase Allowance | Purchase Discount | Sales Discount |
| Trade Discount | Not Recorded Separately | Not Recorded Separately |
| Cash Discount | Purchase Discount | Sales Discount |
| Freight-In (FOB Shipping Point) | Part of Inventory Cost | – |
| Freight-Out (FOB Destination) | – | Selling Expense |
Our Compliance Advisory Services
We work closely with your management team to ensure your business is audit-ready and up to date with all local compliance requirements.
At ACCOUNTINFIRM CO., LTD., we provide industry-specific
Accounting and Bookkeeping Services in Thailand.
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