Ryan Born is Founder & CEO of AudioMicro (http://www.audiomicro.com/). In this video he discusses monthly accounting practices for small businesses.
- Diligently reconcile all bank accounts
- Generate AR detail
- Generate reports: a balance sheet & an income statement
- Compare reports to prior month's statements & investigate discrepancies
As abusiness owner and CPA. A lot of folks wanna know what regular accounting things you're gonna need to be doing on let's say monthly basis to keep their books nice. Every month, here are few things that you should be doing.
First off, reconcile your bank accounts. Make sure you do that. By reconciling your bank accounts, you're gonna make sure that every transaction that occurred coming in and every transaction that occurred coming out, money in and money out made it's way into your book keeping system. Your bank reconciliation is crucial to making sure those transactions were recorded.
Secondly. On a monthly basis, generate an accounts receivables detail also known as an AR detail. That's gonna tell you at the end of your month who owed you money, which of your customers owed you money and at that point you're gonna wanna begin to follow up those folks and make sure you get paid.
The end of every month generate a balance sheet and an income statement. Those 2 reports are crucial. They're gonna show you, your balance sheets gonna show you your assets and liabilities at the end of the month and your income statements are gonna show you how much money you made or lost at that month. Take that balance in your income statement and compare it to the prior months reports. Investigate any discrepancies.
So, there you have it. Those are tips I woulld offer that every small business should be doing on a monthly basis.