How to develop a good accounting bookkeeping system?

Answer 1

For a brand new business, one of the most important aspects to ensure financial success is for the business to be able to accurately and effectively manage their finances. In order to manage their finances, all businesses should develop an internal accounting bookkeeping system. In order to develop an effective system, several steps should be followed.

The first step in developing an effective accounting bookkeeping system is to choose the right software for your new system. While there are many professional bookkeeping systems available, they often come with an expensive price tag. Because of this, it may be more effective to develop your own system. Using a system such as Microsoft Excel or Microsoft Access, you could fairly easily develop your own system. This could further be beneficial to you because it will allow you the flexibility to enhance or update your system as your business evolves.

The second step in developing an effective accounting bookkeeping system is to find someone to monitor and consistently updated the new system. To ensure that the system is running efficiently and accurately, it is quite important that the person running it is experienced in the field. An improperly ran accounting system could lead to inaccurate reporting and be devastating to your business. As the business grows, less experienced, and less expensive, employees could be handled to help further develop and maintain the system.

The third step in developing an effective accounting bookkeeping system is to consistently audit the accounting books. All businesses should audit their financial statements and inventory statements at least quarterly. By auditing their accounting bookkeeping system, the auditor will determine whether the statements created by the system are accurate, whether the system is effective, or whether there are ways the system or process could be improved. The person auditing the system should always be different than the bookkeeper. This aspect of the auditing process is important because it will allow the auditor to determine whether the bookkeeper is committing any acts of fraud.