Bookkeeping

Having a problem reconciling your credit card?

Just recently, I was asked to help someone with reconciling their credit card account in Quick Books.  They had reconciled to the credit card statement as usual, but when they printed off the details, they also had the previous month’s transactions on the report. 

So what had they done wrong?  Simple, they had clicked on the ‘undo last reconciliation’ button by mistake.  So basically they had to reconcile the previous month again, and now everything is correct in their books. 

A bookkeeping tip – look at the transactions listed under your credit card.  If there is a check-mark next to the item, it has been cleared.  If there is this symbol * next to the item, it hasn’t yet been reconciled.  

Another reason to have good bookkeeping practices

 

Want to minimise your chances of getting audited?

Many small business owners fail to keep sufficient books and records.  Business owners may not realise it, but this failure alone can be enough reason for you to be audited by the Canada Revenue Agency (CRA).

As well as inadequate bookkeeping, claiming personal expenses as a business deduction is another trigger for the CRA to perform an audit.  So keep your business and personal expenses separate and have separate bank accounts for your business and personal finances.

And don’t forget to file and pay your taxes on time!

A common bookkeeping error

Where to set-up a Credit Card in your Chart of Accounts

A common mistake is to create the company credit card account as an expense account.  It should actually be listed as a liability account and remember to also set-up your credit card provider as a vendor so you can pay your credit card payments correctly.

Small Business Accounting

Never underestimate the requirement for accurate financial statements! 

An example of these are monthly income statements, balance sheets, and cash-flow statements which are all needed when filing your taxes.  These statements will also help you to assess the financial health of your company and to see where you can create improvements. 

A great investment to help you in this area is to purchase accounting software and of course, hiring the skills of a professional bookkeeper!  There’s no point having software to record your transactions if you’re not sure which side of the equation refers to debits or credits!!

Partial business use of a vehicle

When a vehicle is used partially for business and other purposes, the expenses relating to its use must be apportioned.  The best evidence to support the use of a vehicle is to keep an accurate logbook of business travel maintained for the entire year, showing for each business trip, the destination, the reason for the trip and the distance covered.

A bookkeeping tip…

Just made a purchase for your business?  Make a note on the receipt which expense account it relates to. It makes life so much easier when the time comes to entering the transaction into your books, no more scratching your head trying to remember what the purchase was for!

First Blog Post

Here is your first post. Inside here you should include Keywords that are bold as well as tags down on your right when you are Editing the page for Grand Bookkeeping.