Bookkeeping
How does it work?
Bookkeeping is the process of documenting the daily transactions of your business in a way that both supports tax filings and is useful for management to make intelligent decisions to reach their goals. Many people initially think this sounds easy, but accurate and useful bookkeeping takes both expertise and attention to detail. It is not intuitive and requires a mastery of the double-entry system as well as the creativity to translate the owner’s needs into the numbers.
Depending on where you are in business, you might need a consultation for help entering your own numbers, a quarterly review, or our full bookkeeping service, which includes data entry, month-end reconciliations, financial reporting, and state and local tax filings.
We maintain client books in Intuit’s QuickBooks Online software. While every software has its pros and cons, we support clients with 8-figure revenue in QBO. We can help determine the best plan and provide a discount to the retail price if we set up your books for you. We link bank accounts as defined by client to ensure we see all business transactions, reconcile accounts monthly, send management reporting, and file state and local business taxes.
Best Practices for Client:
- Open bank accounts and credit cards in the business’ name
- Use business bank accounts exclusively for business (avoid mingling personal transactions)
- Link business bank accounts to QBO so all transactions are captured
- Enter transactions consistently: Whether you call something a “phone” or “utility” expense is less important than classifying the same transaction from the same vendor consistently.
- Understand how your Chart of Accounts feeds into your Balance Sheet and Profit & Loss
- Reconcile all Balance Sheet accounts at month-end
- Review your Profit & Loss monthly, compare to the prior month, and reconcile changes with what you know about operations over that period
- Close the books each month, meaning the numbers will not change for that period unless there is a very good reason
- Support all filings with reports from your books of record, and support your books with receipts or details where needed
- Take owner draws or distributions by transferring funds from the same business account to the same personal account on a regular basis