What Does an Effective Bookkeeping System Look Like?

Bookkeeping is a process designed to accurately track income and expenses, facilitate the flow of money through the business and provide reliable data in a timely fashion.  A good process includes schedules, deadlines, and a system of checks and balances.  How do you know if your system is working properly?

• Sales invoicing is completed promptly
• Receivables are collected timely
• Vendors are paid on time to avoid late fees and take advantage of payment discounts
• Bank, credit card and loan balances are reconciled and accurate
• Financial data is reliable and readily available
• Sensitive information is secure
• Taxes are filed and paid promptly to avoid penalties
• Cash Flow is positive and predictable
• The process is documented to easily facilitate staff changes
• The system functions relatively seamlessly
• The owner(s) have confidence in the system and it no longer causes stress