Buyer's Guides
Tips: Understanding Bookkeeping Basics
AllBusiness.com
Date:Thursday, April 27 2006
Date:Thursday, April 27 2006
- To make your bookkeeping easier, open a separate checking account for your business. A business credit card is also a good idea.
- Maintain daily records. This is one of the most basic rules: If you don't keep accurate daily records, you don't have an accurate way to track the financial condition of your business. Different people use different record-keeping systems; what matters is that you have one and use it every day. Once you have a good system set up, accurate record keeping will take just a few minutes a day.
- Handle and review checks carefully. It's easy to be on autopilot when you're writing checks and tossing canceled ones into a filing cabinet without reviewing them. Remember: Those checks are as good as cash. And if something goes wrong, you — not the bank — will be on the hook.
- Get a bank statement with a month-end cutoff. This is another basic tip that can reap big rewards. Synchronizing your bank statement with other monthly records will make it much easier to reconcile your statement and track expenses.
- Leave an audit trail. Your record keeping will be much more effective if you have a system that allows you to quickly and easily retrace your company's financial activities. This means keeping your invoices and checks in numeric order, not skipping check or invoice numbers, and keeping separate bank accounts for your business and personal funds. If you can't go back a year and reconstruct your company's finances, you probably aren't leaving an effective audit trail.
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Additional Steps in Setting Up a Bookkeeping System : A Step-by-Step Guide
- 1. Bookkeeping Basics
- 2. Top 10 Bookkeeping Mistakes by Small Businesses
- 3. Raising Capital
- 4. Demand for Payment
- 5. Invoice for Professional Services (Single Timekeeper)
- 6. Checklist: Understanding Bookkeeping Basics
- 7. Tips: Understanding Bookkeeping Basics
- 8. An Easy-to-Use Manual Bookkeeping System
- 9. Picking the Right Software Bookkeeping Program
- 10. An Overview of Web-based Bookkeeping Solutions
- 11. Using Accountants and Bookkeepers for Small Businesses
- 12. Annual Summary of Expenses
- 13. Accounts Receivable Monthly Customer Statement
- 14. Tips: Choosing the Right Bookkeeping Option
- 15. Checklist: Choosing the Right Bookkeeping Option
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