Takeaways from our discussion

Eye-Opening Takeaways From Our Discussion of the Accounting Cycle

This discussion was originally for Professional Bookkeepers in our Facebook community, but in-house bookkeepers follow the same Accounting Cycle, and the takeaways will benefit both. Oftentimes, business owners and inexperienced managers believe that bookkeepers are only performing data entry tasks, but we know differently. We also know that it is our job to maintain professionalism and adhere to best practices, accounting assumptions, and procedures in our role as bookkeeper.

The Accounting Cycle is circular, and each month we work in two periods at the same time. Those periods are the prior period and current period. But what eludes some non-bookkeepers is during the first one to two weeks of each month we are working in both periods. It is not realistic to believe that once the month is over our work is complete for that month. Our work actually continues until we close the books and send reports to our clients.

We as bookkeepers spend most of our time in the first two stages of the Accounting Cycle for any given period. Those stages are 1) collecting and analyzing transactions, and 2) recording or posting transactions to the Ledger.

Because our tasks are time intensive, a best practice that may be put into place immediately is automating as many tasks as possible. If we do not automate our tasks, we will find that we are spending most of our time chasing documents and managing our client’s data. If we do not automate simple tasks, we will not be able to onboard additional clients needed to grow our firms.

Get source documents as quickly as possible after the end of the prior period. Our clients are busy managing and growing their businesses and bank statements are not on their minds. An automated reminder email or task goes a long way in getting these documents into our offices on time.

Keep in mind bookkeeping tasks are always the same from platform to platform. The tasks are the same even if you are using a manual system. Give your clients world class services by learning how to record transactions and to perform other bookkeeping tasks and continue improving your skills until you perfect them.

Here’s a list of more takeaways:

  • It is possible to close the books within the first week of the current period by automating key tasks, and following a consistent or standard workflow across all clients. I did it and so can you.
  • Communicating with clients and creating a reasonable system for retrieving documents is key to preventing late month end closes.
  • Set monthly appointments with your clients to discuss the report package that was delivered to them after the books were closed. Those reports may include the Balance Sheet, Profit & Loss Statement, Statement of Cash Flows, and any additional reports as agreed between you and your clients.

Join our community for more discussions and trainings on how to use QuickBooks Online. You may also chat with me through my site or book a 15 minute discovery call.