In general, we recommend reconciling each month once the statements are available.
Reconciliation requires categorizing each incoming and outgoing transaction in the correct accounts, ensuring it matched your statements, and closing the month.
As company transaction count volume increases, it is recommended to review and track each transaction more regularly.
From our expertise, once your company has a total of more than 300 transactions a month, we recommend tracking twice a month. Once mid month, and once at the end with your statement.
Once your company has a total of more than 500 transactions a month, it may be worth considering weekly management.
This is because tracking each transaction early can help with the following:
Prevent fraudulent transactions
As transaction volume increases, unauthorized transactions become less noticeable. Catching these early on will help a business ensure they don’t get lost through the cracks at the end of the month.
Catch errors
Reconciliation is important to ensure your books match your bank records. With more frequent management and tracking, catching these errors help keep your books in order and prevent an accumulation of concerns.
Manage cash flow better
Business owners will be able to make better decisions and manage their cash flow more efficiently when they know what cash is present at hand.
Avoid surprises.
Surprises such as bounced check and overdraft fees can be prevented when processing payroll, paying bills or incurring other business expenses. It’s also important to plan ahead with relation to tax liability if your company generates a generous bottom line.
Reconciling these accounts consistency, accurately, and on time can be seen as a business owner’s most dreaded task. However, it’s vital to ensure your company is operating at peak performance.
This is why when company’s begin to grow, it’s top priority to have proper accounting with dedicated resources to ensure it.
Need help with your books? Hire our trusted team of professionals and contact us today.