Managing finances for small businesses can turn out to be a time-consuming task if not done systematically and efficiently. The best solution to easily accommodate your accounting tasks and track down your financial activities is to create an accounting checklist.
Following a well-prepared checklist will help you complete all your financial tasks efficiently and timely, leading to seamless accounting and bookkeeping for ecommerce businesses.
Moreover, you can avoid financial issues like cash shortages or inventory discrepancies.
In this article, we have put together an accounting checklist for small businesses so that they know what financial tasks to do.
Daily Tasks of Accounting and bookkeeping for ecommerce
Monitor the daily financial status
Track the finances your business saved at the end of the day by syncing your company’s bank and credit card feeds. In addition, regularly monitoring receivables and payables will help you determine your business’s financial health by analyzing cash flow.
Weekly Bookkeeping For eCommerce
Maintain a record of transactions
It is a must to maintain a record of all transactions, including billing customers, paying suppliers, paying office expenses, or any other transaction every week for seamless financial management. Moreover, you can use accounting software to record transactions systematically.
Document file receipts
Another important accounting task is to document all the file receipts, such as creating copies of check receivables, invoices, cash payments, credit card statements, etc.
You can ask your accounting outsourcing service provider to summarize weekly revenue and expenses by drafting the income and P&L statement. In addition, sort these file receipts and financial statements alphabetically by week or payroll date for easy access.
Review outstanding bills from vendors
You might have an outstanding bill from your vendor that you need to check to make payment on the due date and update the outstanding amount. Keeping a check on unpaid bills from vendors can help you avail of the maximum discounts.
Review the projected cash flow
You must estimate how much cash you need in the coming week or month to maintain a sufficient cash reserve. This saved amount can be further used to pay bills, vendors, and employees.
Monthly Tasks of Accounting and bookkeeping for ecommerce
Balance business checkbook and inventory status
Reconciling with the company’s checkbook or cash can help you quickly access the errors and rectify them. You should also review the old receivables to know the customer payments made in the fiscal year.
Moreover, when running your small business online, it’s become more crucial to track and record inventory to keep the production ongoing and meet customers’ demands.
In such a case, it’s advisable to practice continuous bookkeeping for ecommerce while reviewing the inventory levels.
Process and review payroll and approve tax payments
Payroll management ensures lawful processing while adhering to state and local regulations. It will be best to withhold, report, and deposit applicable social security, income tax, etc. Furthermore, make sure to maintain accuracy throughout the payroll services.
Review actual profit and loss vs. budget and prior years
Reviewing your small business’ actual profit or loss and comparing them with the budget and previous year’s figures will help you determine how much your company earned and the expenses it incurred over the years and identify other crucial variables.
Professional accounting outsourcing service providers can create custom reports to help you analyze important metrics.
Review month-end balance sheet vs. prior period
By reviewing your small business’ month-end balance sheet and comparing it with the previous period’s balance sheets, you can gain insights into managing your company’s assets and liabilities over time.
Quarterly Accounting Tasks
Review payroll reports and sales tax
Regardless of what industry you are operating in, it’s crucial for all companies, small or big, to adhere to the state laws regulating the sales tax.
Non-compliance with your state’s laws concerning sales tax can lead to financial and legal repercussions and tarnish your business reputation.
Professional accounting services for small business remain updated with the local tax laws. Thus, they review your company’s payroll reports and sales tax obligations accordingly.
They’ll ensure you comply and pay the correct amount as sales tax each month and protect your company against penalties.
Computing estimated income tax
Make sure to compute the income tax your small business must pay according to the state’s income tax-related laws.
Review revised annual profit and loss estimate
A professional accounting outsourcing service provider can review your small business’ assets, liabilities, cash influx, and the difference between revenue and expenses.
Gaining insights into such financial information can help you identify the troubleshooting issues and make informed decisions to improve sales margins.
Annual Tasks of Accounting and bookkeeping for ecommerce
File your tax return
To file your small company’s tax return, first, you should organize the data and documents related to finances. You will need taxpayer ID, bank account, credit card, previous year’s tax return for your business, and accounting information, like GST returns.
In addition, know all the tax deductions that your company is eligible to claim to save money. Another thing you should know is different business structures need different business tax return forms.
So, you should be familiar with the income tax return, Fringe Benefits Tax (FBT) return, and GST annual return forms and determine which tax returns your business is eligible for.
Finally, calculate your business tax payments and file the applicable taxes by the correct deadline.
Approve annual financial reports and tax returns
Before submitting the tax returns applicable to your small business, you must review the company’s annual reports to assess their accuracy. This is where the importance of regular bookkeeping for ecommerce businesses becomes evident.
It will help you check whether you have filed all the necessary documents according to the form’s requirements and correct the last-minute errors.
If the taxation authority finds an error with your tax return form, it might reject it and charge interest and penalties after thorough auditing.
To sum up it all
The steps a small business can take to complete bookkeeping and accounting processes or activities can differ according to industry, business size, or accounting team.
However, the above-discussed are the basic accounting tasks that any small business can do for better financial management and reporting.
Moreover, working with professional accounting services for small business can help streamline bookkeeping and accounting tasks, providing you with insights into your company’s financial health, position, and performance.