The activities your bookkeeper performs encompass several tasks broken down into daily, weekly, and monthly duties. If you are wondering, ‘what should my bookkeeper be doing every month?’, you need to first understand how daily, weekly and monthly bookkeeping duties all work together to create financial transparency and continuity. Here we explain why it is so important to perform these duties regularly to improve efficiency and financial management accuracy, as well as the key players who help make it happen.
What Should A Bookkeeper Do Daily?
The daily duties of a bookkeeper help improve recordkeeping, make overall financial management easier, and allow you to spot and resolve mistakes sooner. Without daily bookkeeping, your weekly and monthly duties become a nightmare. Daily duties become more important for medium to larger-sized businesses that are managing more receipts and transactions. They allow you to:
- Update your financial data to spot discrepancies
- Reconcile cash and receipts to monitor for theft and errors to maintain accountability
- Review and reconcile transactions for approvals
- Record and categorize expenses to keep track of receipts for tax purposes
- Record inventory received, if applicable, to keep counts accurate
What Should A Bookkeeper Do Weekly?
Weekly bookkeeping tasks keep your business operating effectively. As mentioned, smaller businesses can attend to the daily tasks above on a weekly basis if they prefer, as they’ll have fewer transactions and data to review. Weekly bookkeeping tasks are critical for medium to large companies as there will be far more cheques to deposit, invoicing to process, and payroll to manage. Some essential weekly bookkeeping tasks include:
- Recording accounts receivable payments
- Depositing your cash and cheques
- Weekly invoicing to ensure you get paid
- Employee timesheets and payroll if applicable
What Should My Bookkeeper Be Doing Every Month?
Your monthly bookkeeping preserves your records and allows you to ensure your financial integrity is healthy and accurate. Without daily and weekly bookkeeping, your books become difficult to manage and accuracy becomes less reliable. Monthly bookkeeping duties include:
Recording and categorizing revenue and expenses
Your monthly revenue and expenses keep tabs on your performance and financial health, and provide the data for your profit and loss statement. It also provides records for tax purposes, so you are organized for tax season and potential audits.
Reconciling accounts
Reconciling your business accounts monitors discrepancies in deposits and withdrawals/transfers. This ensures you understand how money flows in and out of your business while addressing missing funds. Your bookkeeper should also check to make sure any payments you made or received for the month were cleared. This is also one of the best ways to spot accounting mistakes so you avoid an accumulation of mis-tracked funds that can lead to poor business planning and unexpected deficits. Transactions will also be more familiar, making it easier to review accounts.
Following up on past-due accounts
Past due accounts cost you money. Monthly follow-ups ensure you understand when an account has entered the past due state, and whether that time is increasing each month. Being proactive at getting invoices paid ensures more customers are paying on time and are less likely to turn into unpaid invoices. Since how soon you are paid impacts cash flow, past due account management is business-critical.
Payroll (if applicable)
Payroll is the most important financial obligation for any business. Reviewing payroll monthly allows you to understand demand and where you need to increase hours or cut back. It also improves accuracy for tax purposes.
Monthly close
Closing the books allows your bookkeeper to verify transactions, journals, and summaries as well as compare bills, income, and expenses to physical records like receipts, invoices, and documents.
Managing tax obligations
Monthly review and payment of tax obligations whether it is payroll, HST/GST, etc., ensures you avoid building a costly balance owing, as well as penalties and fines.
Monthly financial statements
Your bookkeeper can also assist with the preparation of monthly income/cash flow statements and balance sheets, allowing you to compare performance month to month. Financial statements also contribute to budgeting best practices, and allow you to have numbers ready to share with your accountant. These reports make sure you are meeting your goals and provide an opportunity to make budget adjustments to align with your business plan.
Who Do Bookkeepers Rely On In Your Business?
Bookkeepers rely on several different employees within your organization as well as external sources to perform their duties efficiently, including:
- Salespeople/cashiers: Depending on the nature of your business, your bookkeeper might rely on salespeople and cashiers who interact with customers, take orders, make cash transactions, etc. These people provide information such as confirmation of transactions, till balances, and orders that can flag inconsistencies in your books and accounts.
- Office staff/managers: The people responsible for placing orders might also interact with your bookkeeper. These are the team members who make purchase orders, receive shipments, approve invoice payments, etc.
- Tax services: Whether you handle your taxes internally, or hire a tax service, your bookkeeper is often the go-to person to help provide the detailed information and receipts required for tax filing.
- Banks and creditors: When transactions are incorrect, or accounts are not aligned with receipts and paper trails, your bookkeeper might reach out to your bank or creditors to clarify information and help determine where the error occurred.
- Clients: It is not uncommon for bookkeepers to follow up with clients regarding invoices whether it is answering questions to confirm information, or tracking down unpaid invoices to make sure you get paid on time.
- Accountants: Bookkeepers provide the financial statements your accountant needs to prepare detailed financial reports and other types of financial statements. Your bookkeeper prepares your monthly statements and is most familiar with your accounts and cash flow.
- Payroll: If you have a payroll department or service, your bookkeeper might share information such as time sheets, or assist with payroll processing. They might also be your main point of contact for employees who have questions or requests regarding their pay.
- Inventory or sales team: Your inventory and sales team help bookkeepers confirm stock items and reporting and can answer questions about discrepancies.
As you can see, the duties a bookkeeper should perform each month are quite detailed. They use daily and weekly monitoring to ensure your books are organized and current each month. They also rely on many different people in your company, as well as service providers involved in various forms of administration, to complete their duties. Understanding monthly bookkeeping duties helps ensure you keep up with your finances efficiently to effectively run a sustainable, successful business.
If you would like to learn more about the accounting and bookkeeping services provided by Intrepidium, call us today at 778-800-7976 or click here to schedule a consultation.
