5 Steps for Better Accounting
May 10, 2020

5 Stepping Stones to Stronger Accounting:

 

My Business is profitable but I don’t see cash!!!!

I don’t know where my is money going despite having great sales!!!

Book of Accounts is Greek and Latin to me!!!

 

Are these your challenges? Here are 5 easy stepping stones to be in complete command of your accounts.

 

  1. Receivables:

The strongest pillar of your accounts would be Receivables. Review it every week to ensure that you collect all your money on time. Remember “Cash is King”.

  1. Proper Documentation:

Maintain different files for all your documents. As per FTA law you need to maintain books for at least 8 years.

  • Segregate your documents as Sales, Purchase and Petty Cash.
  • Stamp your documents as entered and paid, it will ensure that you have accounted each document and avoided duplicate payments.
  1. Accurate Entry:

To ensure you have a perfect account you need to keep the following in mind:

  • Avoid posting anything to Miscellaneous and Suspense accounts. Remember these are traps.
  • Business bank accounts to be reconciled on a Weekly or Monthly basis depending on the volume of the business.
  • Petty Cash to be reconciled daily.
  1. Segregating your business and Personal Accounts:

A thumb rule would be never spending anything personal from your business accounts. You and your business are two different entities.

  1. Books to be reviewed by a Professional:

You can certainly maintain your own books of accounts specially with user friendly accounting software. Ensure it is reviewed periodically by an accountant for meaningful reports.