Monthly Bookkeeping Checklist: What You Must Provide

Are you spending precious time chasing down missing receipts and struggling to remember which invoices have been paid? A streamlined bookkeeping process is the backbone of any successful business, and a crucial component is consistent communication and document delivery to your bookkeeper. Understanding what's expected of you each month significantly reduces errors, ensures timely financial reporting, and frees you to focus on growing your business. This article outlines your "Monthly Bookkeeping Checklist: Essential Documents" and clarifies "What Your Bookkeeper Needs from You Each Month" to achieve seamless financial management.

The Foundation: Bank and Credit Card Statements

Perhaps the most critical element of your monthly bookkeeping package is providing complete and accurate bank and credit card statements. These documents paint a clear picture of your business's financial activity and serve as the primary source for transaction recording.

Bank Statements

These official records from your bank detail all deposits, withdrawals, electronic transfers, and other transactions impacting your checking and savings accounts. Your bookkeeper uses these statements to reconcile your bank accounts, ensuring that your internal records match the bank's records.

• Provide statements for all business bank accounts.

• Ensure the statements cover the entire monthly period.

• Download statements as PDFs directly from your bank's website whenever possible. This reduces the risk of manual entry errors.

• If physical statements are used, ensure they are legible and complete.

Failing to provide all bank statements, or providing incomplete statements, can lead to inaccurate financial reporting, missed deductions, and difficulty reconciling your accounts. This could result in an inaccurate picture of your cash flow and profitability.

Credit Card Statements

Similar to bank statements, credit card statements provide a detailed record of all charges, payments, and credits applied to your business credit cards. These statements are essential for tracking expenses, categorizing purchases, and claiming relevant tax deductions.

• Include statements for all business credit cards, even if there was no activity during the month.

• As with bank statements, download PDFs directly from your credit card provider's website.

• Pay close attention to due dates and payment schedules to avoid late fees and maintain a good credit score.

Inaccurate credit card records can distort your expense tracking and potentially lead to overspending or missed opportunities for rewards and cashback.

Income Verification: Sales Records and Invoices

Verifying your business's income is just as important as tracking expenses. Sales records and invoices provide the necessary documentation to accurately reflect your revenue streams.

Sales Records

Sales records encompass various forms of documentation that confirm your business's sales transactions. This can include point-of-sale (POS) reports, online sales platform data, and summary reports from payment processors.

• Provide detailed POS reports outlining sales by product or service.

• Include reports from online marketplaces like Shopify or Etsy.

• Submit reports from payment processors such as Stripe or PayPal, detailing all transactions and associated fees.

Comprehensive sales records are crucial for accurately tracking revenue, calculating sales tax, and understanding trends in your business's performance.

Invoices

Invoices are particularly important for businesses that bill clients for services rendered. They provide a detailed record of the services provided, the amount due, and the payment terms.

• Provide copies of all invoices issued during the month.

• Clearly indicate the invoice number, date, client name, and a detailed description of the services provided.

• Track invoice payment statuses (paid, unpaid, overdue) and communicate this information to your bookkeeper.

Proper invoice management helps you track outstanding receivables, manage cash flow, and identify potential issues with client payments.

Expense Documentation: Receipts and Bills

Documenting your business expenses is critical for claiming tax deductions and understanding where your money is going. Receipts and bills provide the necessary evidence to support your expense claims.

Receipts

Receipts are proof of purchase for goods and services. They should include the vendor's name, the date of purchase, a description of the items purchased, and the amount paid.

• Keep all business-related receipts, both physical and digital.

• Organize receipts by category (e.g., office supplies, travel, meals).

• Use a receipt scanning app to digitize physical receipts and store them electronically.

• Provide clear and legible copies of all receipts.

Missing receipts can lead to missed tax deductions and an inaccurate picture of your business's expenses. According to the IRS, taxpayers are responsible for substantiating their deductions.

Bills

Bills represent ongoing expenses such as utilities, rent, and subscriptions. They typically include the vendor's name, the billing period, the amount due, and the payment due date.

• Provide copies of all bills received during the month.

• Ensure bills are paid on time to avoid late fees and maintain good relationships with vendors.

• Maintain a record of bill payments to track expenses and ensure accuracy.

Consistent bill management allows you to monitor your recurring expenses, identify opportunities for cost savings, and maintain accurate financial records.

Other Important Documents

Beyond the core documents mentioned above, there are other pieces of information your bookkeeper may need to ensure accurate and complete record-keeping.

• Loan documents: Provide documentation for any new or existing loans, including loan agreements, payment schedules, and interest rates.

• Leases: Include copies of lease agreements for office space, equipment, or vehicles.

• Payroll information: Submit payroll reports detailing employee wages, taxes withheld, and employer contributions.

• Tax notices: Share any tax notices or correspondence received from the IRS or state tax agencies.

• Contracts: Contracts related to significant revenue or expense items can be important to review.

Providing these documents will help your bookkeeper gain a holistic understanding of your business's financial operations.

Streamlining the Process: Best Practices

Submitting all these documents each month may seem daunting, but implementing a few simple best practices can make the process much more manageable.

• Establish a consistent schedule for gathering and submitting documents.

• Use cloud-based storage solutions like Google Drive or Dropbox to share documents securely.

• Communicate regularly with your bookkeeper to address any questions or concerns.

• Consider using bookkeeping software that integrates with your bank accounts and credit cards to automate data entry.

By following these best practices, you can streamline the bookkeeping process, reduce errors, and ensure that your bookkeeper has the information they need to provide accurate and timely financial reports.

Conclusion

Maintaining accurate and up-to-date financial records is essential for the success of any business. By consistently providing your bookkeeper with the documents outlined in this "Monthly Bookkeeping Checklist: Essential Documents", you can ensure that your finances are well-managed, your tax obligations are met, and you have a clear picture of your business's financial health. Don't underestimate "What Your Bookkeeper Needs from You Each Month". Take the time to gather and organize these documents each month, and you'll be well on your way to financial success. Now, create a recurring reminder in your calendar and start gathering those documents today! Contact a bookkeeping professional to help streamline your process.