How to Organize Your Monthly Bookkeeping Routine
Make your life (and your bookkeeper’s life) easier
When you look at your bookkeeping from a holistic standpoint, you may notice some gaps. Maybe your books are closing late every month, or maybe your business has innovated faster than your bookkeeping methods. No matter where you are in your holistic bookkeeping journey, you’ll be able to benefit from sitting down and organizing your monthly bookkeeping routine. That way, if and when you choose to work with a fractional CFO to improve your business’s finances, your new partner will have accurate, well-organized information from which to work.
Below are our four steps for organizing your monthly bookkeeping routine to make your life—and your bookkeeper’s life—easier.
Use software designed for the goal.
It’s time to ditch the Excel spreadsheets—they aren’t doing you any favors. You and your team will save time by using bookkeeping software that is fit to purpose. Rather than keeping up with and emailing many versions of spreadsheets, most bookkeeping software allows you to share synced, up-to-date books with your bookkeeper. But before you spend money on advanced software, do your research. You don’t want to overpay for software with features you will never use, and you want to make sure you become fluent in your software before handing your numbers over to your bookkeeper, fractional CFO, or other team members.
Check out this guide to the five software options you should have in your business’s tool stack.
Stay on schedule.
Every month, set a date in your calendar and block off some time to close your books. Businesses need an average of 6.4 days to close out the previous month’s books. Try choosing a date that is 5-7 business days after the last date of the previous month to set as your close-by date. The end-of-month close process allows you to set your numbers in stone.
When you’re first setting up your routine, you may need to set aside more time than necessary for organizing and optimizing your software, making sure you know what numbers and resources you need each month, and getting the hang of the work. After that, streamlining your system will get much easier.
Keep your personal and professional expenses separate.
Although you likely already have separate bank accounts for business and personal finances, it’s always worth the reminder not to let these overlap without clear, timely record keeping. Don’t forget to write expense reports if you do spend personal dollars on business activities. Even if you are a team of one, mixed books can get out of hand (and become a tax or legal problem) quickly. Besides having a separate bank account for your small business, best practices mean having separate bookkeeping and budgeting software, logins, credit cards, and even separate times allocated to your financial management so you can keep track of your revenue, cash flow, and expenses accurately.
Find a bookkeeper who fits your needs.
You can make your life and your daily, weekly, and monthly bookkeeping routines easier by finding the right bookkeeper. You want to partner with a bookkeeper who shares your values and complements your work style. Be sure to find a bookkeeper who prefers the same ratio of meetings to hands-off work, and who communicates clearly on a cadence that makes sense to you.
At the end of the day, your bookkeeper should make your life easier, not harder. And your holistic bookkeeping process should always make your business run better.
If you’re struggling to make sense of your business’s finances, consider bringing in a fractional CFO. This trusted temporary teammate will help you take a look at your finances from the eyes of an expert. You’ll be thankful you did.
Curious what this could look like for your business? Email info@breakawayba.com to learn more about how we can come alongside you.