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Weekly Accounting Must Do’s
Having strong bookkeeping and financial records are extremely important for the success of a business. Businesses can sink or float depending on how well they handle their finances. Small businesses especially are very susceptible to sinking if they have poor accounting practices.
Even though small businesses rely so heavily on cashflow. It’s not uncommon for small business owners to not have the best grasp on finances themselves. Often they believe that accounting is better suited for larger companies with more assets, so run their business like they run their own personal finances.
However, having good accounting practices are imperative to keep your business running smoothly and with less risk that could potentially cost you the business.
So here are a few things you should do every week to ensure you’re on top of everything!
1. Bank Account Reconciliation
A reconciliation is an important accounting process where two sets of records are compared to check that all figures are correct, consistent and complete.
Small businesses often only reconcile their accounts once a month once they receive their bank statements. While this may seem logical, that means that there is a 30 plus day gap between checks. A lot can happen in that time! If you can, you should reconcile all of your cash accounts weekly to keep on top of it and to action any issues right away should you find any.
2. Vendor Payments
You need a solid system for paying your vendors. This is very important in helping you keen on top of your debts, as well as establishing a good reputation and credit history.
Each vendor’s payment requirements will differ, so you need to make sure that you’re on top of this and note when payments are due. Some vendors may bill monthly, while other may require payment on receipt. If you only make your payments once a month, you could end up paying off things late.
Paying your bills weekly can really help avoid any late payments and any other issues that can arise if you don’t regularly keep on top of things.
3. Customer Receipts
The only thing that may be worse than making your vendors unhappy is making your customers unhappy.
Paying bills is not fun for anyone, so you especially don’t want your customers receiving late notices for bills they have actually already paid. To avoid this issue, make sure that your customer receipts are recorded as soon as possible. Preferably daily, but weekly should also be enough.
4. Other Transaction Entries
Vendor payments and customer receipts will most likely make up the bulk of your transactions, but you probably have some others too. Auto debits, bank fees and interest payment are common transactions that will need to be recorded weekly.
Doing a task like this helps prevent everything building up over a month and becoming and overwhelming task when issues are too far gone to resolve.
Staying on top of your accounting is extremely important. So many common and painful issues can be avoided by doing tasks weekly rather than monthly or even more sporadically.
If you would like any more help or advice on any of these tasks, please don’t hesitate to contact us! Phone: 08 6336 6200 Email: info@ascentwa.com.au
Need help with your accounting?
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