Choosing the Right Accountant

How can accounting grow your small business?

The accountant is an important part of every organization; after all, poor financial management is often the reason for a company’s failure in the first three to five years.

Unfortunately, the accounting department, which includes Accounts Payable and Receivable, is also one of the most complex parts of any company. Accounting is rife with sophisticated and interrelated processes, as well as multiple stages of engagement and permission from other departments and supervisors.

This is an issue that should be handled at all times; remember, your financial department is what helps you get the money your company deserves for all of your hard work and high-quality service or product!

Why put them off working on a new initiative to better their department by debating about “cost vs. value”?

Efficiency. In the workplace, we all desire it. There is no field in which efficiency is more crucial than accounting. Here are some ideas for improving the efficiency of your accounting department without investing a lot of money.

The accounting department in any firm will always have a significant role in handling business finances: incoming and outgoing cash, financial statements, and so on. When your accountants are late with their duties, it can lead to financial losses for your firm. It’s critical for you to urge your employees to work more effectively as a business owner. Take a look at these helpful hints.

Train your staff

The first step is to ensure that those in charge of your accounts are knowledgeable. They should be able to adapt to your company’s financial operations as well as any accounting software. As a result, conducting training to improve the effectiveness of your financial team is highly advised.

You can provide a variety of training options, including in-house seminars, external conferences, one-on-one training, and more.

Cross-training is also necessary to fill up the gaps in your accounting department, particularly when one accountant is unwell, on vacation, or unexpectedly leaves. When this occurs, another person who has been cross-trained can temporarily take up the financial chores.

Create efficient policies

Financial management indiscipline is one of the top money wasters for businesses. As a result, it is critical for your organization to establish payment procedures and deadlines. Request that your finance department process all payments, including salary and contracts, as soon as possible.

You must also keep track of your customers’ payments. Before your customer’s or clients’ invoices become past due, ask your team to send them reminders. Your finance staff will be able to simply manage your firm cash flow and present complete financial statements each month if they follow set standards.

Improve departmental collaboration

Your finance and accounting departments cannot function independently, and they frequently rely on financial data from other departments. Manually requesting data from each department takes a long time.

Allowing all departments in your firm to use a shared system to boost productivity is recommended. A cloud-based ERP software can assist your organization in integrating all departments, allowing your finance department to receive entire data from each department in seconds.

Process payments in batches

It’s inefficient to process every single invoice or receipt that arrives one by one. Make sure your finance department consolidates and processes all invoices at the same time to save time and work. As a result, urge all of your employees to submit their invoices or reimbursement claims at the same time so that the finance department can handle everything at once.

Automate manual tasks

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Manual accounting, which takes a long time in this technology age, should have been abandoned. Provide an accounting system that automates your finance department’s complex tasks in order for them to perform more efficiently.

In just a few clicks, your finance department may generate reports, calculate profits and losses, make invoices, record and save transaction information, handle taxes, and much more. Your financial team may focus on other vital tasks by automating a lot of manual work.

Communicate well with your team

Your finance staff will have clarity on what they should do if your accounting department’s expectations are communicated from the start. Explain to them the policies and processes that your organization has created so that they will always follow them. Be open to their suggestions and ideas, especially if they are true financial experts.

Upskill your finance team

It is critical to ensure that the employees in charge of your accounts are knowledgeable. They must be able to stay up with internal procedures as well as any accounting software that your organization has deployed. As a result, conducting training to improve the effectiveness of your financial team is highly advised.

You can provide a variety of training options, including in-house seminars, external conferences, and one-on-one training. While your accountant is on leave, cross-training will be quite beneficial in allowing other staff to temporarily perform financial chores.

Ensure that policies and procedures are followed

Financial department indiscipline is one of the largest money wasters for businesses. As a result, it’s critical for your business to establish policies and procedures to ensure that financial transactions are carried out in compliance with your company’s norms and standards. Request that your finance department process all payments, including salary and contracts, as soon as possible.

Pay close attention to your receivables. Before your customer’s or clients’ invoices become past due, ask your team to send them reminders. Your employees will have an easier time managing your company’s cash flow and ensuring the accuracy of financial reporting at all times.

Integrate your accounting department with the rest of your organization

Your finance and accounting department does not work in isolation, and they frequently rely on financial data from other departments. Manually requesting data from each department is a time-consuming process.

Allowing all departments in your firm to use a shared system to boost productivity is recommended. A cloud-based ERP software can assist your organization in integrating all departments, allowing your finance department to receive entire data from each department in seconds.

Take advantage of batch processing

It’s inefficient to process every single invoice or receipt that arrives one by one.

To save time and effort, have your finance department aggregate all invoices and process them at the same time. As a result, it’s preferable to urge all of your employees to submit their invoices or reimbursement claims at the same time so that the finance department can handle everything at once.

Reduce manual processes

Manual methods consume a significant amount of time and energy. Provide an accounting system that automates all of the complex operations so that your finance department can perform more efficiently. In just a few clicks, your finance department may generate reports, calculate profits and losses, make invoices, record and save transaction information, handle taxes, and much more. Your financial team may focus on other vital tasks by automating a lot of manual work.

Improve team communication

Your finance staff will have more clarity on what they should do if you communicate your accounting department’s expectations up front. Explain the policies and processes in place so that they will always follow them. Listen to their thoughts and opinions; they may have some good suggestions for reducing superfluous work, completing tasks faster, and cooperating with other teams in novel ways.

Put in place cutoff policies

Create and follow monthly billing and expense-recording deadline policies. For example, make sure all bills are submitted to the accounting department by the end of each month. Too many modifications — or waiting for invoices and cost reports from several employees or departments — waste time and can lead to financial statement delays. Making late changes can also harm any current financial analysis.

Keep it timely

You may be able to save a significant amount of time towards the end of the year by reconciling your bank accounts promptly following the end of each month. It’s far easier to correct errors if you identify them early on. Reconcile your payables and receivables data with your financial statements.

Create a cover sheet for coding

An accounting clerk or bookkeeper will need a variety of information to input vendor bills and donor gifts into your accounting system. To make the procedure go faster, gather all of that information on one document. The account numbers for your general ledger should be put on a code cover sheet so that the individual entering data does not have to look them up every time.

If the invoice is to be paid by check, electronic transfer, or credit card, the cover page should also include a space for the relevant person to sign off on the invoice before it is paid. To designate which cost center should receive the funding, use multiple-choice boxes. The invoice or a copy of the donor’s check may be attached to the cover sheet for reference.

Batch items to process

Only one invoice or check should be inserted or cut at a time. Set aside some time when you have a lot of information to process. Some companies process payments just once or twice a month. There will be fewer “emergency” checks and deposits if you make your scheduled public.

Insist on oversight

Ensure that the person or group in charge of financial oversight (for example, your CFO, treasurer, or finance committee) reviews monthly bank statements, financial statements, and accounting entries for obvious errors or unexpected amounts—the value of such reviews increases when they’re done right after each monthly reporting period ends.

Avoid doing any number crunching outside of your accounting program

Many organizations do not get the most out of their accounting software because they do not devote enough time to learning how to use it. If necessary, hire a trainer to go over the software’s basic features with staff and provide time-saving ideas and shortcuts.

To save time, avoid using Excel® or other spreadsheet programs for any calculations or financial report presentations. Continue to use and print reports from your accounting program. This will also reduce the number of entry errors.

Consider automating common journal entries and payroll allocations with your accounting software. Many systems can remember transactions and automate operations like payroll distribution to several programs or vacation accrual reporting. However, make regular comparisons of any estimates to actual figures, and always adjust to the real amount before closing your books at the end of the year.

Examine the procedures in your accounting system

Accounting systems that are not properly managed may become inefficient over time. Look for steps that can be automated or that add no value and should be eliminated. Steps are frequently duplicated by two different people, or the process is slowed by the “handing over” of a project component.

Your accounting function should be shared

If a few organizations in your neighbourhood are willing to outsource their accounting activities to your organization, you might be able to share a CFO and support staff. At a moderate expense, you’d almost likely be able to improve the efficiency and effectiveness of your accounting department. Standard background checks would be undertaken, and your role in the CFO and support staff vetting would be properly documented.

As you analyze your accounting function for ways to improve efficiency, seek opinions from other sources. Your auditors, volunteer treasurer, banker, and other financial experts may recommend streamlining processes. 

Create and stick to rigorous deadline/cutoff policies

Waiting for staff is one of the most time-consuming aspects of accounting, especially because most accounting departments have precise protocols in place for the rest of the company to follow when filing bills and adjustments.

Once these policies are in place, assess their effectiveness and potential for improvement.

Make frequent statements or speak with senior management about repeat offenders in certain areas if it’s a reoccurring problem throughout the organization before it becomes a problem that management must account for.

Batch processing helps people save time and lives

Don’t immediately process every check, invoice, or refund request that comes in. Decide on a specific month to process these, usually two or three dates in advance.

Make sure to tell everybody who might need a check from you about these dates; having this information available to the rest of the company decreases the amount of “emergency” checks and reimbursements.

Use your complicated and very functional accounting program!

Even if you don’t have a top-of-the-line “essentially does it for you” tool, chances are you have some electronic bookkeeping in place at your company.

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Resist the impulse to crunch numbers outside of this system, no matter how powerful it is. Even if it appears that getting the system to accomplish what you want will take months, consider hiring a software trainer to show you how to do it or hiring someone to program the capability. In the long term, it will save you literally days and hours.

Examine the capabilities that your accounting system promised during the initial purchase phase and see if it was fulfilled. Speak with your congressman about how to make that case.

Conduct process walk-throughs

As an accounting manager or even an account payable clerk (for example), you may be able to see the process from the inside and imagine what the ideal world would look like if everyone followed the rules.

From the perspective of other departments in your company, these stages may appear to be a waste of time or unimportant to the overall process.

What’s the true issue? It’s totally feasible that they’re correct!

When a process is not maintained, it might result in weird workflows with great concepts but poor implementation. At least once a year, walk through the procedure from beginning to end as if you were a customer or another department member.

An Annual Process Review can give you a lot of insight into a company’s or department’s weak spots, especially if you bring in a process specialist or consultant who can look at things objectively through the lens of process improvement across the board.

Stop wasting time on chores that can be completed by a computer

There are many aspects of accounting that necessitate actual creativity and decision-making.

However, in reality, there are several aspects of an accounting department that computers excel at. We did, after all, abandon the abacus in favor of the calculator.

With the correct software, an accounting department can use electronic forms and document management to not only automate monotonous procedures like routing or decision-based form control, but also to completely eliminate paper forms from the purchase request or invoicing process.

That may appear hard, but it isn’t. Consider your current procedure in an ideal environment, and then try to imagine what a computer could do for you. A computer can easily enforce rules with zero exceptions, ensuring that errors in the approval process and who should be making what judgments are avoided.

Double-entry is eliminated when systems are linked through a document management system; simple no-coding interface with existing accounting department software should be a standard feature.

CPAs can use a range of tactics to help a company’s accounting department improve and optimize its financial processes. Many businesses argue they are too busy or don’t have the time to implement such adjustments, despite the fact that they can improve financial reporting and save labor costs. “Pick one or two areas that can make the biggest difference in operations and make them priorities,” Waugaman advises. As views change, other proposals can be implemented. Supporting the current quo, with disgruntled employees and outdated financial figures, is one option.

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