Tag Archives: bookkeeping

Tips For Doing Your Own Bookkeeping

This information is for those of you who have decided to purchase a bookkeeping program, like Quickbooks, and to go ahead and do your own bookkeeping. Congratulations! You are on your way to becoming more organized with your business finances.

Taking a break from the excitement you are feeling, let’s consider that doing your own bookkeeping can be an intimidating project especially if you have never done it before. But there are some great resources out there to make sure you are doing things correctly.

One thing you can do is learn how to use Quickbooks through an instructor led class or training workshop. These are usually not very expensive, about $389.95 and up, and can get you started on the right foot. You can also take classes online or order training programs. These can start as low as $39.95. Oftentimes you can find smaller accounting firms that teach these trainings for a lower hourly fee. Quickbooks Intuit offers some great resources for finding both online, program based, and instructor led courses.

In addition to taking an official course, we suggest the following tips to help you as you begin keeping your own books:

1. Know What Constitutes a Receipt. A receipt is a cleared check, bank statement, credit card statement or actual receipt.
2. Stay on Top of It. Do your bookkeeping at least once a month.
3. Make Sure Your System Makes Sense to You. If you don’t understand it, your tax accountant won’t either.
4. Be Thorough. When recording income, make sure to include the record type, check number, date, and a copy of the payment. This will help clear up any client payment disputes.
5. Just Do It. The hardest part of bookkeeping is sitting down and doing it.

Now that you have an idea of what you need to do to get started on your bookkeeping, make sure you utilize some or all of these resources to make sure you are doing your books correctly.

Matthew P. Anderson is the Web Administrator for Soulence Tax and Accounting.

To download Quickbooks and Quickbooks training programs at a discounted price go to http://soulence.com/get-quickbooks/

To learn how to find financial peace of mind using the services Soulence Tax and Accounting provides, visit their website: http://soulence.com/

Article Source: http://EzineArticles.com/?expert=Matthew_P_Anders

What Information is My Accounting System Not Receiving?

Most small business owners understand about entering information into their accounting systems to help regulate and reconcile their business earnings and expenses. This also helps to make things easier at tax time.

However there are sometimes some things that aren’t entered into your accounting system that really should be.

The core entries are usually the same for most businesses. These include accounts receivable and accounts payable, billing, stock or inventory and sales orders. Your business may also record things like purchase orders or keep a cash book, where your business records collection and payment.

Some businesses may also require entries for expenses, electronic payment processing, payroll tracking for employee salaries, taxes and superannuation payments, and purchase requisitions.

But many businesses don’t consider entering in many of the very small expenses they see each month that could really add up to a substantial amount by the end of the year. These can include bank fees and charges and other similar charges you may not have entered.

You should also consider entering such things as debt collection, bad debts and any overdue bills. In some businesses, these can be written off prior to tax time as bad debts. In other cases, you may also incur fees related to your debt collection efforts.

It’s important you also ensure your personal expenditure is kept separate from your business records. Even if you’re a sole trader and your personal income is intermingled with your business earnings, you should still make an effort to keep your records separated, entering your business information into your accounting systems and keeping a separate track of your own personal drawings.

If you keep up with entering your business information into your accounting systems on a regular basis, you’ll find it much easier to keep up throughout the year. You’ll also find that you’re much less likely to miss important information when you keep up with it regularly.

If ever you’re unsure about what you’re supposed to enter into your accounting systems, it’s important you speak to your accountant about your options. This can make it much easier for you to always know what you should be entering and what you should be keeping track of.

For more information see Reid Maddison Brisbane Accountants, Your partner in Financial Management

Article Source: http://EzineArticles.com/?expert=Julie_Sultmann

Settling Your Creditors Bills, Out of Debtors.

There is nothing worse than fielding sustained calls from creditors for unpaid bills. Some people have mastered the skill in dealing with creditors, others, detest that familiar number appearing on the phone screen, and reject the call.

 

It is a known fact, that most reasonable businesses pay their bills on time, regardless. Some businesses are known to have huge debtors books, but bills are paid immediately.

They obviously fund their bills out of cash sales, deposits, or previous months settlements. This is admirable. But many small businesses do not have this luxury, and have to find creative ways to fund their creditors.

 

Creditors cannot be stalled, forever. They will eventually take action to recoup whatever monies are due to them. You or your business end up with a bad credit report, or worse, court action. Each of us is different and will deal with bills and creditors differently, but panicking and paying every bill, can harm your cash flow.

 

Of course certain bills should be paid on time, such as phones, rentals, wages etc. But certain bills that stipulate terms should be paid strictly according those terms.

 

Your creditors should be sympathetic to the fact that your business also has debtors. (I know, they not). Stall them until your cash flow improves. Find a balance between your debtors settlement period, and pay your creditors accordingly.

 

Every business should generate a debtors age analysis at a certain cut off period. Run a creditors age analysis as well. Compare the two totals. If creditors totals are way above your debtors total, then the business have some serious problems. Ideally, debtors lists should exceed creditors lists, by the ratio 2: 1!

 

The next step would be to break down the respective lists into 90, 60 and 30 days.

Estimate, which debtors on the age analysis, are good debtors, target  those “reliable” debtors, they can cover creditors/bills in 90days. As soon as the debtor’’s receipts are processed pay the most urgent creditors.

 

If more debtors payments are received, continue to settle creditors in the 60day period. Don’t panic when that current creditor calls. Eliminate, creditors in the 90day, then 60day, and then and 30day period. Collect from debtors in the same sequence. When arranging for payment, always have your creditors, and debtors age analysis and cash book balance available. The cashbook, or bank statement is used for verification of debtor’s deposits. That old excuse, “the cheque is in the mail”, is NOT, a payment, until the check has been received and banked!

 

Importantly, this advice would be fruitless, if both sales invoices and bills are not recorded in the accounting system. All relevant documentation should be written up, to ensure  that an accurate age analysis can to be produced. A collections and payments file cannot be overlooked. As soon as bills are settled, they stamped and filed away. In the rush to pay, unmarked bills can mistakenly be ‘doubled paid”, and you will not get a refund from your creditor for an over payment, only a “credit”, on your next statement.

 

If bills are settled without taking cognizance of cash flow, and late debtors, the business will inevitably run into cash flow problems. Keep your creditors happy at all times, but don’t be their slave!

 

Author: Sean Goss  sgafc@mweb.co.za

 

 

 

A Case for Co-operation, Between Bookkeeper and Accountant.

The accounting profession is diverse. For most people a bookkeeper and accountant is considered to be the same. Some clients even refer to their highly trained accountants as their “ bookkeepers”.

 

This article has no intention to heap scorn on the professional bookkeeper. If anything, their work enables the accountant to prepare and finalize their assignments.

Bookkeepers are found everywhere, from small to large corporations, and in government departments.

 

I will not touch on the old debate of the differences of the bookkeeper and accountant, suffice to say that there are many synergies between the two professions. Depending on the size of the organizations, a bookkeeper could essentially perform an accountant’s job.

 

It is on the divergence on the two professions where most of the confusion sets in. A bookkeeper could have performed a vital function for a small business for years, but when professional reports, are required, the help of an accountant will have to be enlisted. Sometimes to the detriment of the loyal bookkeeper.

 

The training and education of bookkeepers is different from that of an accountant. Some people become bookkeepers without any studying. Others attend short courses at training colleges varying from six months to two years. In certain cases bookkeepers can opt for professional membership. Accountants training is prescribed by many statutory accounting bodies, and their training is substantially more involved, and different from a bookkeepers training.

 

For bookkeepers to assume that they can run and report on an organizations complete accounting system, is sheer arrogance. Bookkeepers expertise in balancing the checkbooks, reconciling the accounts and other functions is not sufficient. Keeping current with GAAP, GRAP and IFRS, is not known to be strength of bookkeepers.

 

The training that bookkeepers receive, do not equip them to deal with complex tax transactions and the disclosure of certain accounting items such as “Intangibles”.

Bookkeepers should preferably outsource these functions to experienced qualified accountants. It happens very reluctantly.

 

The accounting industry is a very “selfish” industry. Unlike the medical or legal fraternity, we reluctantly share work or assignments. A medical doctor, when consulted, will not hesitate to refer patient to a specialist or another doctor. The same goes for attorneys. Bookkeepers in private practice will “hold on”, to a client, despite not being equipped to deal with the assignment.

 

Business clients should verify the credentials of their bookkeepers before engaging them for complex assignments. Accountants and bookkeepers can work hand in hand. For some accountants to get involved in bookkeeping is a tedious task, they need the assistance of bookkeepers.

Many tasks cannot be performed without an accountant. But accountants can also outsource work to bookkeepers. The two professions must augment each other. But persistent greed will kill the industry.

 

Author: Sean Goss  sgafc@mweb.co.za