Here are the recurring tasks you should complete monthly to keep your books clean. This checklist is built for small business owners and operations leads who are managing finances on top of everything else. Files can get accidentally deleted, corrupted, or overwritten, and it’s difficult or even impossible to recover them. Whether you use cloud storage, an bookkeeping external hard drive, or an automated backup system, having copies of your files ensures you can quickly restore them if something goes wrong.
- Organizing these documents at the start of your bookkeeping process makes the rest of the tasks easier and more efficient.
- Use both cloud storage and secure local options to ensure your data is safe.
- It ensures you stay organized, complete tasks on time, have accurate financial reports, and can effectively manage your clients’ finances.
- And the best way to stay on track is with a trusted, thorough, and repeatable checklist.
- Plus, you can make more informed business decisions about how to spend it.
Review Your Profit and Loss Statement
Before you delve into the intricate details of reconciliation and report generation, it’s crucial to lay a solid foundation. This preparatory phase ensures a smoother and more efficient month-end close. Taking stock of your company’s performance and health is essential for further planning and strategizing, so you must ensure the data presented is accurate. However, you can often negotiate longer terms if your company is short on cash. This practice can help you avoid the issue of unauthorized overtime pay. If an employee works more than 40 hours a week, you can be held liable to pay for overtime even if you didn’t authorize it.
- Calculating depreciation is an essential task for keeping your business records accurate and financially sound.
- Includes both basic and advanced versions for different business sizes.
- It also ensures that you are meeting all of your financial responsibilities and tax deadlines.
- Cross-check each transaction with your accounting software to identify unmatched items.
- That way, you can focus on scaling your business while keeping your finances in order.
Record Payroll and Employee Benefits
If you are not using a cloud-based system with automatic updates, make sure you update your bookkeeping software. This will decrease potential for errors, crashing, and other software problems. Connect with our team at Link My Books to learn how we can help you achieve accurate, hassle-free bookkeeping.
Monthly Bookkeeping Tasks
- You can automate your workflows and your client communication, plus easily collaborate with colleagues in a unified location.
- With built-in collaboration features, your team can communicate directly within tasks, reducing confusion, enhancing accountability, and improving overall efficiency.
- Revenue, payroll, marketing, travel—each category gives you clarity into how money moves through your business.
- Review outstanding loans, make sure payroll liabilities are correctly accounted for, and adjust any deferred revenue or expenses.
Start by comparing your bank and credit card statements with your accounting records. Yes, cash and accrual accounting affect how and when you record transactions during your monthly bookkeeping. Accrual requires tracking receivables and payables, while cash basis records transactions when cash changes hands. To decide Retained Earnings on Balance Sheet which method fits your needs, see our Cash Basis vs Accrual Basis guide.
Entering inventory into your system the same day you receive it keeps your system current, giving you a more accurate look at your stock. Without this level of inventory management, your staff may lose sales by telling customers you’re out of stock when an item just hasn’t been entered into the system. Also, if your staff sells out of an item, reordering may be delayed if your system isn’t set up to allow negative inventory counts. Reconciling cash and receipts at the end of each day helps you quickly discover cash shortages or overages. You can then determine where the money went and identify errors, employee fraud or theft. It is essential to do this every day because it’s easier to spot discrepancies with recent transactions.