Wednesday, June 8th, 2011
In our last blog post “Bring Your Banking Into Your Books In Real Time” we discussed the importance of immediacy in your financial system’s content. Bringing your “books” into the 21st century not only means plugging your real time banking data to your inhouse system, but also means keeping all of your business processes plugged in and synchronized, creating a real time view. If you are looking for ways to make your profits (or losses) more visible, wrapping your arms around timely, in-sync, accurate information is a must! So how do you create and maintain a real time view of your business? Are there simple steps to get started? Isn’t batching all receivables into a system one day and batching all payables into your system another day the only method that works?
Well, thinking of banking, what good is knowing all of your debits without knowing all of your credits? Same with the view of your business. Revisit your data recording processes, wrapping your mind around a full picture on a given day instead of like process entry:
- When you create an AR invoice, create any relevant purchase orders.
- When you pay your bills, verify that your payables match your purchase orders.
- When you cut payroll, all taxes and other deductions must be posted. Don’t be out of step.
You can’t see the bottom line if you don’t maintain the full, accurate, real time picture inside your books.
Whether it be daily or weekly, making synchronization and timliness a priority will reap the benefits that you need as a business owner. Half a picture is no picture at all!
Next Week: Create a safe, remote working environment.
Tags: accounting best practices, banking, real time
Posted in Hot Topics, Tip of the Week | No Comments »
Thursday, June 2nd, 2011
Small and mid-sized business owners have the challenge of reaching profitability without the army of high-level financial professionals that larger companies have.
But can a small to mid-sized firm find clever, cost-efficient ways to see their profits or losses quickly and accurately? Are there sure-fire shortcuts that an owner can use when a one-person Accounting Department needs to produce the same quick answers that a multi-member financial team in a larger corporation can produce?
The answer is a resounding yes! You can achieve this if some of the most basic office processes are made real-time and are properly automated.
We’re launching a twelve part series on how to bring your business into the 21st century with real time accounting practices. The following is the first post in the series.
Is your accounting in line with your bank account?
The Internet has transformed banking. If you do your personal banking online (if you don’t, where have you been all this time?), you know that whenever you use your debit card, or perform any transaction, it shows up on your bank balance immediately.
So why does your bookkeeper wait for the end of month bank statement before reconciling your bank balance within your accounting system?
Your bookkeeper needs to create a bank reconciliation ASAP
If your bookkeeper waits for a statement in the mail and doesn’t routinely create the bank reconciliation within the accounting system, change this immediately. You want to know about anything and everything affecting cash flow and the bottom line as soon as possible.
Automatic electronic withdrawals, ATM use, deposits, payments, and every cash occurrence into and out of your company should show up inside your books right away.
In this real time world, you need real time practices
In this fast-paced, competitive business landscape, the last thing you need is to wonder if the check has or hasn’t posted yet. You should never get side-swiped by a surprise mistake at the end of the month.
In this day and age that’s unacceptable. Your accounting practices should be brought into the real time world.
Next week: Creating and Maintaining a Real-Time View of Your Business.
Tags: accounting best practices, banking, real time
Posted in Accounting, Hot Topics, Tip of the Week | No Comments »
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