As we’re doing some ‘back to basics’ training tonight and I’m making mental lists of stuff to cover I thought I’d run through one of the basics here.
Folks do all sorts of things with receipts and we’ve all mislaid them or forgotten about all the small things like bus fares. Here’s a basic process to help you get better at accounting for all these costs:
- keep every receipt for costs incurred related to your business (even if some cannot be used for tax purposes you need to know what you are spending … all those coffee meetings add up)
- put them somewhere so that you can see them piling up (and thus needing your attention) … personally i put all my receipts in a pile on my desk and when the pile falls over I know it’s time to enter them into MyCake. Other people put them in an envelope and when the envelope is full they put them into their book-keeping system/spreadsheet.
- as you enter your receipts into your book-keeping process you should number them (most book-keeping software will allocate the number automatically, write this number on the receipt) .. this is so that you or your accountant can find it again easily.
- staple the receipts onto sheets of A4 paper and file them. This means that the numbers will be sequential and the pages roughly chronological … again helps you finding things later.
The process above means that you’ll keep on top of your book-keeping more regularly than the once a year panic to file a tax return. After all, this is your financial data and it can help you run your business better … why only dance to the tune of the tax man?