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Keeping business records

5 February 2013 No Comment

1.      A quick reference guide

1.1.   This is an abbreviated reference for clients who need to collate their quarterly records.

1.2.   The full story is here if you need to check anything in more detail.

2.      Invoicing and Sales

2.1.   You need to generate an invoice for every sale you make. That includes:

2.1.1.      Fees for services

2.1.2.      Fees for goods sold

2.1.3.      Commissions received

2.1.4.      Expenses which you want to recover from your customer

2.2.   Check that the invoice numbers follow on from last time, that no invoice numbers are missing and that no number has been used twice.

 

 2.3.   Add a copy of each of your invoice PDFs to the pending/ sales folder on DropBox.

3.      Purchases from Suppliers

3.1.   Work through your business purchases (made with business funds), and separate out any personal purchases (made with personal funds, for example, cash paid to taxi drivers). Put any personal “Expenses Receipts” to one side for the moment. The things that you paid for personally (even if they are for the business) are not called “Purchases” and they will be dealt with later at Step 5 below.

 

3.2.   Add all of your supplier invoice PDFs to the pending/purchases folder on DropBox.

 3.3.   If you are VAT registered, you must have a VAT receipt for any “Purchases” that included VAT. You cannot claim back VAT without them.

4.      Bank Accounts

4.1.   The bank statements are our starting point. They must be absolutely right and absolutely complete. The best way to do this is to use online banking and print the relevant screen to PDF. Downloaded CSV files are often inconsistent and the running balance column can be wrong or missing altogether. Please prepare PDFs instead. Log in to your online banking service . . .

 

 4.2.   Set the dates so that you can see an online statement covering the whole of last month. Then print that to PDF.

 

 4.3.   Save your bank statements using meaningful file names. Repeat that for each business current account, savings account, PayPal account etc. Make sure that all of the PDFs that you’re making include the Balance column. Then add these PDFs to the pending/bank folder on DropBox.

 4.4.   If your set of bank statements is incomplete, we will not be able to start our bookkeeping exercise.

5.      Expense Receipts

5.1.   Take the pile of expense receipts which you had left over from Step 3 above. If your business is VAT registered, divide this pile of personal expense receipts into two, the ones which make no mention of VAT and the ones which are proper VAT receipts. Prepare separate expense claims for non-VAT items and for VAT items. You can use a digital tool (like Expensify if you wish) or you can use these proformas:

Mileage Claim

Non-VAT Expenses

VAT Expenses

 

 5.2.   Print the completed expense claim forms to PDF and add all of them to your personal folder under the pending/expenses folder on DropBox. Add all of the supporting receipts too as we do sample checking. We know that some people prefer to keep small fiddly paper receipts as “paper only”. That’s fine by us, as long as you can find them when they are needed.

6.      Payroll

 6.1.   If we maintain your payroll we already have the records we need.

 6.2.   If you look after your own payroll, then we need monthly payroll summaries from you. Please add P32 reports and an analysis of all staff and their net pay figures to DropBox. Your bookkeeper or your payroll bureau will know what that means, and should give you the correct reports.

 7.      The quarterly reports

7.1.   We will use this information to generate quarterly reports, including a profit and loss account, a balance sheet, a tax forecast and (where required) a VAT return. A full run down of the reports is set out here.

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