5 tips to keep your bookwork accurate
1. Check your bank balance
While data feeds are wonderful – they are not fool proof. Some bank feeds are not as reliable as others. User error can also alter bank figures. Inexperienced users can cause errors without realising. Don’t fully rely on the cloud based software. As a backup check that the reconciled balance is the same as the actual balance on the bank statement.
2. Check Auto Match Entries
Cloud based programs are great at helping to match bank entries to invoices, payments, bills, receipts and commonly used transactions. This is a great function but if you are not careful auto match can cause errors in your records and at times they can multiply the errors. Take your time and use caution when clearing off transactions with software “suggested” matches.
3. Check the Profit and Loss Report Regularly
it is important to regularly run a profit and loss report and review the information. You can chose to present it broken up into months and this is a great way to look for inconsistencies. Often inconsistencies in figures from one month compared to others is an indicator that errors may exist in the underlying data.
4. Check the Balance Sheet Regularly
Run the balance sheet at the end of each month or quarter to see that the figures make sense. Your balance sheet outlines the assets and liabilities of your business. Check the bank account and credit card balances are correct. Accounts such as PAYG Withholding Payable, Super payable and GST tell you how much you owe at a given time. Check these figures – be aware of how much you owe – this is really important for business management and can also help you to pick up any errors in you bookwork.
5. Check Debtors and Creditors
Regularly run a debtors and creditors payable reports. It is common for users to enter bills into their accounting package, but later when they pay it they re-enter it or record it differently. When this happens creditors can end up really messy with liabilities that are not accurate. Debtors can also get messy when old debts continue to sit on the books – clear them out.