Does December always seem to find you scrambling to be ready for a new year? Is one of your biggest problems reconciling your financial ledgers? If you said yes, you’re not alone – many businesses find this task time consuming and burdensome, which often leads to putting it off as long as possible. The task of reconciling your financial ledgers, however, is not an option. It’s a requirement to ensure that your business is operating within federal laws; it also maintains your accountability with stakeholders, indicates your net worth, and gives you important information to help you make decisions for the upcoming year.
As you might guess, then, reconciling your financial ledgers isn’t a task you should leave until December. You can’t complete it, of course, until December, but it’s essential that you work on it throughout the year. And while that sounds like nothing more than extending a hateful task from one month to twelve, it’s actually good news – it means that your December will be less stressful, and, more importantly, you’ll have fewer accounting errors.
Consider these strategies:
Documentation
The only way to correctly reconcile your financial ledgers is with the comprehensive documentation of financial transactions and resources acquired and lost throughout the year.
Financial transactions that weren’t documented didn’t happen. Absolutely every transaction must be recorded, and not just customer transactions – utility payments, the purchase of office supplies, money transfers, tax payments or credits, and any other business activities that involve something monetary need to have files attached to them. This verifies operations and leaves a trail for the government to follow should you get audited.
Proper documentation is the key to a perfectly balanced ledger at the end of the year. And, as you might guess, this process is easiest when taken on a transaction-by-transaction, day-by-day, week-by-week, month-by-month basis – the more work you do as you go, the less scrambling you do when crunch time comes.
Technology
Good accounting software is a boon to any business. While filing vouchers with receipts in a shoebox has never been the way to go, the financial software on the market today makes it even less so – most solutions track your transactions and offer warnings when problems arise. Good software also tracks and displays your budget, spending, banking, bills, savings, investments, retirement plans, and debt levels, all in one convenient place.
And even if you choose not to buy a financial software suite, there are other tools available online, often for free, to help you with accounting tasks.
Professional Help
Accurate financials are paramount to assessing the health of your business, forecasting growth, and making relevant, realistic goals for your future. As individuals hire accountants to handle their savings, go to tax professionals for February 15th, and have advisors for their investments, your business can also benefit from a wealth professional. Mastering finance requires extensive research and learning, and you have many other tasks to handle – savvy businesses know that delegation to the right party saves time and is fiscally rewarding.
Please contact us to see how a partnership with Holdfast Wealth will secure a legacy for your company for generations to come.
