Spellcheck your bookkeeping Reviewing your clients’ accounting records
@ledgerscope
Rob Furness, Director, Ledgerscope Limited Ledgerscope is the cloud software company behind the popular Movemybooks, Checkmybooks and Backupmybooks services. Checkmybooks is the affordable accounting year-end review tool.
Year-end accounts work makes the largest contribution to the income of most accountancy practices. It is also the foundation from which additional services can be offered to clients – both complimentary compliance services and added-value advisory services...
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o, it’s never been more important for accountants to secure their compliance work into the future. However, with compliance fees static or falling, year-end accounts work must be managed ever more efficiently. The process is always the same – review, analyse and correct – but how you go about this work will determine whether this year-end job is profitable or not. Productivity gains are the price of staying in the game.
spot, but the accumulated effects of smaller problems, replicated over thousands of individual transactions, are truly the “devil in the detail”.
Bookkeeping software ensures that accounting records are balanced (we have the magic of double-entry to thank for that) but, as we all know too well, balanced does not always mean accurate, or even reasonable. If errors crept into the space between chair and keyboard, how can Xero (or any accounting software) know what you meant to do?
SOFTWARE CAN AUTOMATE THIS CHECKING FOR YOU
As a bookkeeper, at the end of the year you want to wrap up a tidy set of books and, as an accountant, you want your year-end jobs in and out as quickly as possible. In both cases there is the need to review the numbers to make sure they can be relied upon and reported on. Obvious howlers are usually easy to 84 / Issue 13
Whatever your approach to analysis, whether using client software, exporting to excel or using a reporting/analysis tool the review process involves looking for the same issues and trying to make sure that you are consistent in how your staff review all your clients.
Completeness of your entries Checking recurring transactions such as utility bills, mobile phone payments or loan repayments, yearend software can keep track of the number of transactions enabling you to identify missing items or make appropriate accruals and prepayments. Consistency of your postings No matter how you have customised your chart of accounts, what is important is the repeatability of how you post particular transactions. Some
suppliers like Amazon are so universal it’s hard to easily check they have been recorded correctly, but for most other suppliers each of their invoices should follow a distinct pattern. So, if you find 5 invoices posted to one account and one is posted elsewhere, then alarms may need to start ringing. Year-end software can run this analysis quickly and produce an exceptions report. Fixed asset checks Small transactions posted to asset accounts don’t make much sense and large transactions in profit and loss accounts should be reviewed to see if they should be reclassified as capital expenditure. With yearend software, every transaction is reviewed and transactions that are unexpectedly low or high are easily identified. Credits and debits Rent is rent is rent, well it is except when a rent receivable and a rent payable get confused and get entered incorrectly. Hopefully double entry has made sure the direction of funds flow is correct but a rent receivable balance that is understated because of a
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