My List of Monthly and Quarterly Accounting Jobs

workbook-1205044_640If you are a regular reader, you will know that I used to be an accountant. My second-favourite accounting joke (not mine, sadly) is “I used to be an accountant. But I’m alright now”. Boom Boom! OK, fair enough, accountants are not generally known for their GSOH.

I don’t want you to think there are only two jokes about being an accountant. Not so. My client Heena, who is one too, well we cracked a couple more of those together only last Saturday and a right laugh we had too. But maybe you have to be one to appreciate accounting humour. And we were laughing at ourselves mainly. And one was about auditing. Kudos to Heena. Difficult to get a joke out of that.

So this will make me more likely than you, perhaps, to relish doing my monthly and quarterly accounting tasks though I suspect I will not be the only nerd reading this.

Quirkily, although my business gets simpler and simpler to run, my list of accounting tasks is quite long and seems to be getting longer still. Let’s start with the quarterly list first, it’s shorter!

Once a quarter at 31st December, 31st March, 30th June and 30th September I send those of my clients who are VAT registered an invoice for their records. As it happens I am not VAT registered so there’s no VAT on my invoices, but they are more likely than a non-VAT registered client to request an invoice. Right now I am doing that for two clients, both called Sarah. But if you want one of those and you are not getting it, all you have to do is ask, whatever your name is. And if your VAT quarters are different to that sequence, pls advise.

Right, that’s the easy one done and it’s not accounting at all, it’s Word and email. I do have it diarised in Outlook so I don’t forget. And colour-coded, of course! Red is the colour for matters fiscal, financial and monetary.

Once a month I also do the following:

Download my bank statements for my business account and enter the transactions into Sage, my accounting program of choice. And do a bank rec.

Download ditto from PayPal and repeat. This is a tad more complex for several reasons. PayPal deduct a small charge from each transaction so I, being a pedant, enter the gross receipt and then total up the charges and enter that separately. Reconciling both matches the net receipts but my total gross income is correctly shown, as are my costs.

I also have a working capital loan from PayPal which has a separate account which needs reconciling to the repayments. This helps me to know how much I have left to pay off.

I have a business credit card so again I download the statement and enter the items into Sage, and the other side of that entry is when my business a/c pays the card off in full a few days later. Balanced.

Doing these each month enables me to monitor income and review expenditure and create forecasts and to know who’s paid and who hasn’t, although usually I know that much sooner than the month end. A review of credit card expenditure is particularly vital as it enables me to do things like increase or reduce capacity of things I use each month and pay less or more as required. Less is my favourite.

I then do the same for me personal account and put it on a spreadsheet, not in Sage.

Then I update the projections for next month’s cashflow in and out for both business and personal to make sure that I have managed cash to meet all payments as they fall due. No more bouncers for me. Fell out of love with that during the last recession. 1987-1992 since you ask.

And then I do my monthly accounts which measure profits and losses. Sage makes this easy. Touch of a button, literally. Assuming you have done your data entry correctly which mostly I have. A quick review usually throws up any anomalies which can be corrected there and then while you can remember what you were up to/being distracted by at the point of entry. A good rule of thumb is every distraction = the possibility of a data entry error.

I have a PayPal forecast so I know who’s due to pay me and when, and how much I will transfer from PayPal and when to my main business account, so one feeds into the other and make sense when read together too. And a combined PayPal and business (and separately personal) cashflow forecast, as above. Separately and together. Belt and braces. But they show different things to a pedant.

I have a separate account for my property rental income and expenses so I download that statement and enter income and expenditure transactions onto another spreadsheet. Effectively this is updating last month’s budget and converting it to actual, then forecasting forward the implications of any unforeseen charges this month or void rents (very unusual in my current set-up but it does happen). When it comes to year-end for my lettings accounts at 5th April, I already have the sums to hand. Smugness alert.

Each month end I also calculate work-in-progress for clients who have paid me fees for a year or more in advance. How many months of their annual subscription have they taken and how much money is outstanding? This is an important figure in my accounts, especially at year-end, and I don’t count the sale until I have delivered against it. We accountants call these payments in advance pre-payments and they have to be accounted for in the relevant accounting period. WIP currently stands, for example, at just over £4,000. Your equivalent in your business may be stock. A sum of this size has implications and is pertinent. Apart from anything else, should something unexpected happen to me, my estate would owe this money back to my clients for undelivered services to date.

One last quick check is how much affiliate income am I due and when and are all payments up to date.

A wonderful feeling of calm comes over me at this point, which might give rise to a sudden urge to do the filing! Rewards are often issued. It being the last day of the month, I might even take the rest of the day off. Be still my beating heart.

Your Biz Your Way

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