The 12 Edicts of Bulletproof Books
You are part of an accounting team now. We all need to pull together and follow simple guidelines to achieve useful bulletproof accounting records.
If you keep our “12 Edicts of Bookkeeping” top of mind you, we, your bank and the CRA will all be happy.
1. Keep business & personal transactions separate.
bank accounts, credit cards – everything.
- No personal expenses should come out of your biz accounts – none, zero, nada – This keeps it very clear that the transactions are business expenses. Otherwise you are leaving it to us to decide for you and it may not be in your favour.
- Due to shareholders and owners – we need to make sure that this account is neither too high or too low.
- Get a handle on your personal bills & payments. Plan accordingly. Keep the transfers to & from to a minimum. Always transfer from your business account to your personal account and pay your bills from your personal account.
2. Run all business transactions through business bank accounts and credit cards.
Money in and money out!
- Unless you are a retail operation don’t do business in cash.
- You must have online banking and eStatements set up for us to do your books.
3. Upload receipts for everything business related to your Receipt Bank App.
Every stinkin’ one of them!
- Ensure the payment method is on them.
- Business meals and entertainment, who & why written on them.
4. If you buy something significant, finance something or loan out money, we will need a copy of the paperwork so we can post it correctly.
Honesty is the best policy.
5. Mileage log
for goodness sake use an app.
- It’s tax-free money in your pocket!
- It is cheap to get. We suggest you use QBO.
6. Make sure you are dealing with above board, compliant businesses and subcontractors.
Don’t hire anyone if they want cash “off the books” – it’s illegal.
- Do they issue professional bills (none of this handwritten stuff), do they have a business number, WCB registered…?
- Same deal with your customers if you are B2B.
7. Have new hires fill out employee forms when they arrive.
on day 1 the minute they set foot in your door.
- This goes for you and your family too.
- Crucial information is: SIN, DOB and address.
8. File (or have us file) your taxes, including source deductions, a few days ahead of the deadline.
If you can pay them, do it on time!
- Even if you can’t pay them, file them to avoid penalties and raising red flags.
9. The GST you collect is not your money and the taxes you withheld from your employees is not your money.
Put some aside to pay your taxes on time.
- We suggest you open a separate bank account and move money in there so it will be available when tax time comes.
10. Communicate in a friendly, timely manner with us.
Let’s save the nagging for our families.
- Don’t make us chase you around for documents, answers and responses. We will do the same.
11. Review your reports and respond to us about them within 5 days of receiving them.
If you see errors or things that seem out of whack, let’s clean them up right away.
- We cannot go back to closed periods for clean up, check carefully – right now.
- We are human, make sure we haven’t made a mistake. You are human, make sure you haven’t made a mistake.
- Review your Chart of Accounts often. Your reporting, how you know about your company’s financial health, is based on it.
12. Assign the duties clearly that you or your staff will handle.
Communicate that chain of command to us.
- If you are too busy to work with us, please designate an alternate contact you trust for us to ask questions, obtain documents etc.
- If you don’t have an assignee and aren’t keeping up, we may need to re-evaluate and increase AJ Bookkeeping’s role in your bookkeeping.
We know these rules seem simple enough, that does not mean they are always easy to follow.
You are paying AJ Bookkeeping your hard-earned money to provide you with top-notch books – accurate, timely data that is key to the financial health of your company – information that can help you grow and prosper.
Don’t throw your accounting dollars away by not following our “edicts”.