Small business bookkeeping in a perfect world would involve three steps:
- STEP 1: Enter transactions as they occur by the person actually making the transaction. For example, you stop to buy gasoline. You snap a photo of the receipt on your cell phone and enter the transaction on your mobile phone accounting app. Later you accept a new client and send an electronic invoice the same way.
- STEP 2: Match the transactions with data reported by the bank. The accounting system imports this automatically and does a pretty good job matching it with your records.
- STEP 3: After end of the month have a second person reconcile the accounting records to the monthly bank statement.
Not every transaction follows this ideal work-flow. That’s OK. Plenty of small firms today make up for spotty expense recording by relying on effortless bank transaction reporting. Keeping up with the recordkeeping in a few minutes per day is easier than waiting until the end of the month.
Finally, if you get stuck, don’t struggle with it. Get help! Bookkeeping help is cheap and readily available from remote providers. I work with trusted supervised accounting interns to get client records in good shape before tackling other accounting functions. Once the system is set up it almost flows effortlessly. Today’s bookkeeping systems even ‘learn’ your system over time to predict and further speed the work.