Accounting Checklist For New Businesses
Do you plan to start a new business? Accounting should be one of your top priorities. It makes it possible to track your income and expenditure. Accounting is an essential component of ‘everything you need to know to get started with your new business’.
It helps you establish quantitative financial information for the government, your management team, and investors.
Proper accounting streamlines decision-making processes.
Here is a checklist for your daily, weekly, and monthly accounting tasks.
1. Daily Accounting Tasks
These are the tasks that you cannot afford to push forward. You have to complete them every day. A common mistake among small business owners is postponing critical accounting tasks. This results in a lot of wasted time during audit season.
Most of the daily accounting tasks only take a few minutes. However, neglecting them ultimately wastes a lot of your time. You may spend hours trying to figure out what went wrong and resolving discrepancies.
Create a routine and make time for your accounting tasks. This way, you can improve the effectiveness and accuracy of your books.
Here are a few of the most critical daily accounting tasks:
- refreshing and updating financial data
- Reviewing and reconciling transactions
- Reconciling cash and receipts
- Categorizing and recording your business expenses
- Recording your inventory.
2. Weekly Accounting Tasks
These tasks aren’t very time-sensitive. However, you cannot afford to neglect them. Weekly accounting tasks focus on cash flow, records, and promoting smooth business operations.
The tasks include:
- Recording the payments you get; checks and deposit cash
- Billing your clients
- Review your employees’ timesheets.
3. Monthly Accounting Tasks
The goal of these tasks is to preserve your records in the long run. They keep your accounts reliable and promote integrity.
Here are a few tasks that you need to perform every month.
- Paying vendors or arranging for them to be Paid
- Backing up your data if you don’t use cloud-based software that backs up your information automatically
- Tracking your variances and budgets.
Reasons to Prioritize Your Accounting Tasks
When the topic of accounting comes up, it is easy to assume that you can push things forward. However, many accounting tasks are time-sensitive—failure to complete them on time results in problems in the future.
Most business owners understand that accounting is essential. However, they may not have enough time to take care of everything at the same time.
The secret is to allocate time for each task. Think of accounting tasks that need to be completed every day, weekly, and monthly. That way, you don’t feel the pressure to do everything at the same time. No matter how insignificant a task may seem, it would be best if you always did it at the allocated time.
Prioritizing your accounting tasks promotes time management. You will have a better working experience knowing that a team member is handling your business taxes or monthly reports. Delegating tasks is a good idea if you have a lot to handle.
With the right people on your team, you can identify opportunities and navigate all uncertainties.
In conclusion, every new business needs to create an accounting checklist. Have separate lists for your daily, weekly, and monthly tasks. Since every business is different, your competitor’s priorities won’t always be similar to yours.
When running a small business, accounting should be something you do regularly and not once in a while. Come up with a routine that emphasizes efficiency and accuracy in your processes.
Find a way to track your inventory systematically. It is a simple yet effective way to reduce theft and keep your merchandise safe. While accounting is essential for small businesses, bigger ones could also benefit.
