Common Bookkeeping Errors

By   July 31, 2017

Chances are, if you’ve been a bookkeeper for any period of time, you’ve made at least an error or two. Commonly, these errors occur in the first few years of your career but, if you’re not careful, can become a habit that you need to nip in the bud. We’ve listed a few of the most common bookkeeping errors, submitted by actual, professional bookkeepers melbourne, for you to watch out for as you progress down this career path!

  • Never combine your personal and business funds! : As tempting as it is to use your business account for a personal transaction, resist the urge! Any bookkeeper will tell you that this is a dangerous web to weave. If it does happen, make sure you document everything. Keep receipts. However, if it all possible, keep your personal and business funds
  • Don’t forget to reconcile your bank accounts! : Sit down with your bank ledger on a daily basis and make sure that you’re reconciling all transactions that are coming out of or going into your bank accounts. If there are any charges that need to be disputed, most banks give you up to 30 days to approach them about it. All payments and expenses should be double checked by your bookkeeper to make sure they are on both the bank ledger and your accounting software.
  • Don’t forget to stay on top of your A/R (Accounts Receivable)! : This is self explanatory and obvious, but it is often still one of the most common errors bookkeepers make! It can become easy to focus on the day to day operations and money making but miss the bigger transactions on a monthly basis. Make sure you’re getting paid! It’s also important to make sure you’re entering in all transactions (as mentioned above in tip #2). Besides the cash impact, calling clients and accounts who have already been called about collections can cause you to lose those clients. Simply having your bookkeeper stay on top of your Accounts Receivable can easily solve all that.
  • Don’t mistake simply downloading transactions into QuickBooks for “virtual bookkeeping”! : We know all of your bookkeepers are doing great at downloading their transactions into QuickBooks, but the software is unable to know exactly how to code them. This works the same for both expenses and deposits. You should be regularly having your bookkeeper check your uncategorized expenses category, as this is where all of those un-coded transactions will end up. Make sure someone is checking all transactions that are being downloaded every single day to avoid errors.

No matter if you’re a seasoned, professional bookkeeper or someone just starting out, we all make mistakes. The best way to avoid those mistakes is to be aware of the most common issues so you can steer clear of them or change your behavior! If you’re interested in additional information, please check out www.bookkeeperco.com.au for other resources, tips and errors to watch out for.