4 practices to reduce accounting headaches
1. Choose internet banking over cheques
You may not realise this, preparing cheques can take up to 10 minutes of your time. It’s not just the cheque. You need to prepare the envelope, stamp and then post it out.
Internet banking removes all these small tasks. What more, you will never have to deal with a cheque lost-in-mail situation.
2. Always compare transactions with bank statement
Set aside at least 15 to 20 minutes to reconcile your bank statement with your cash book when you receive your statement. It is a reaffirmation that your record tracking is going well. You may also discover some extra charges imposed by some banks that are not obvious to you.
3. Do not contra
When you buy and sell to the same company, do not contra your payment and receipt. While it does seem logical, it creates a lot more confusion. You will end up spending more time doing reconciliation work.
The best way is the straightforward way. Pay straight. If you worry about bad debts, perform a cheque swap.
4. Number your official documents
Use serialised numbers for all your official documents. Each type of document should have its own running numbers. It will help detect missing documents and make quicker filing and searching of documents.
If all these are too much for you, why not hire a reputable accounting company or book-keeper to maintain your books on a monthly, quarterly or yearly basis. Outsourcing non-core activities can free up a lot of your time and let you focus on the essential activities.