Organized Bookkeeping

Bookkeeping Checklists

One of the themes that I hear from new bookkeepers or business owners is:

What am I supposed to do?

There is the challenge of doing each task each month, but making sure that you do all the required tasks.

Now, most online bookkeeping systems allow you to down load transactions.  Some even allow you to set up rules for coding.  Does that mean the monthly bookkeeping is done, crossed off your list, and on to other things?

Nope, sadly enough.  If you want your business to grow there are a few more things.

*  Let the bank feed work it’s magic.

*  Reconcile the bank accounts and other downloaded financial accounts.  Believe it or not, most programs have problems skipping or not coding transactions.  It’s a tool, not a failsafe, don’t let the bus go under 55 miles per hour tool.

* Get all your receipts together.  They can be scanned, paper, or emailed to you.  Use a tool to check off each one in the accounting system.  OMG that sounds like work, right?  The IRS requires that you keep business receipts for allowable expenses.  If you need organize by vendor or expense type, that can cut down on the work.

*  Make sure your business mileage is recorded according to IRS rules.  Beginning, ending, business purpose, destination and date.  It’s difficult/impossible to do this task in April or March.

*  Now when you cross checked the business receipts, did you notice that you found some that weren’t processed through a bank card?  Make sure you enter them.

*  Business loans:  Make sure the payment wasn’t entirely debited to interest expense.  Credit cards and loan payments are the most likely to miscoded.  Since they are usually large amounts, miscoding can have a material effect on the financial statements.

* Fixed Assets:  Were any large purchases actually for equipment or other fixed assets?  Recode as needed. Again, this can materially effect the financial statements.

* Owner payments or Equity infusions:  Check with your tax professional or Certified Public Accountant.  Just remember that owner payments are rarely an expense of the company.  There are circumstances where that is true.  However, that doesn’t happen by accident.  Consult your own professional for your personal circumstance.

*  Sales.  How are they posted?  Are you happy with that level of detail?  The most common issue I see here are companies posting sales tax as income.  That needs to be cleaned up so that you can live in reality land.

*  Payroll taxes:  Oh my, this is the area that separates the wannabee bookkeepers from the professionals.  Large national payroll providers will tell you post everything to payroll expense.  I’m going to post a longer entry on this, because this area is important.  If you are late on paying your payroll taxes, it’s a liability, not an expense.

Run financial statements.  Do they look right?  No?

Rinse and Repeat.