For a lot of business owners, just the thought of reconciling their accounts once a month is enough to make them go weak at the knees, never mind every day.
Some business owners feel that bank reconciliation is wasted time that doesn’t bring in revenue, yet there are plenty of contract and remote bookkeepers who work for their clients each week, and some that work every day for the same client, reconciling their accounts and providing other vital bookkeeping services.
And they’re not just big businesses whose accounts are reconciled daily — plenty of small businesses do so too.
In fact, with so many small businesses going asunder due to cash flow problems (often stemming from a lack of procedures in place for credit and debt management) it can be not only a cost-saver but a potential life-saver to your business.
Our bookkeeping course graduates understands why reconciling your accounts every day can be extremely useful, and it was very relevant for a mid-sized company with 48 staff that she has worked for in the past.
Here are some reasons why:
If you’re a small business, reconciling just one day’s accounts is a lot quicker and easier than trying to reconcile an entire week or month.
There’s less potential for error, and it’s easier to resolve any issues when they do crop up because you’re not looking through days and weeks of transactions.
For small businesses, daily reconciliation takes between 5 and 10 minutes; for larger businesses, it could be 30-60 minutes each day.
If you or a staff member just needs to learn how to perform bank reconciliations using QuickBooks Online, MYOB or Xero see our Bank Reconciliation Courses.
Too many business owners log onto their internet banking to get an idea of their cash flow, but this is an imprecise way to manage your finances. It doesn’t take into — excuse the pun — account any pending payments and, worse still, it doesn’t give you a clear idea of who hasn’t paid you yet and whether they’re late in doing so.
If your accounts are reconciled daily, you can use your accounting software to get a true picture of your cash flow.
Daily reconciliation can provide you with great insights into your business’s financial future, in particular, it greatly assists with payroll.
Many business owners find payroll immensely stressful, especially when it leaves their cash flow tight, due to late or unpaid invoices.
If you reconcile your accounts on a daily basis, you’ll know exactly where you’ll be when payroll comes around, and whether or not there’ll be any cash shortfalls.
With so many bookkeeper, how do you find someone with whom you can trust your most sensitive financial information? Do you know exactly what role a bookkeeper could play in your business? How much will they charge?
If you are unsure where to start when looking for a truly competent and professional bookkeeper you can trust and rely on, word of mouth may be helpful — if you can get it.
You can find good bookkeepers at the National Bookkeeping directory.
When students enrol into our Bookkeeping Academy course packages they get discounted membership to this directory.
Some listed bookkeepers are degree qualified and others have decades of experience in different industry sectors – and they are ready to start working with your business, in person or in the cloud.
Bookkeeping Academy membership gives students more niche learning and training on integrations which add to the functionality of the major accounting programs.
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