Accounting, Payroll & Pension Issues/question
Are there any ways and procedures that a small business owner could quickly double check an accounting system to ensure that the accounting and bookkeeping staff have not made mistakes besides using an auditor.
Also can you refer me to any reference materials that provide greater insights as to how a small business owner can set up a system with checks and balances whereby he or she can quickly verify and check over the accounting system for accountant and bookkeeper errors.
Yes, there are.
1. Be sure the checking accounts are reconciled. In fact, be sure all accounts are reconciled.
2. Most balance sheet accounts have original documents which are paper. For example, accounts payable and loans have paper documents received from vendors and lenders to whom money is owed. The balances on those documents need to be reconciled to the balances in your accounting system.
3. Asset accounts represent physical property. Check your assets, computers, furniture, cars, etc. to be sure they are accurately shown on the balance sheet. If your business has inventory, count inventory and be sure it is correct compared to what is shown on your financial statements.
These are the things that an auditor will do to check the veracity of your financial records.
Cash is the most precious asset because, of course, it's the easiest to steal, or make errors with. It would be best if the people making out the check and deposits is different from the oerson doing the bank reconcilkiation. The problem is most small businesses do not have enough people to have the poerson doing the reconcikliation different from the poerson who records transactions into the ledger.
Intuit, the people behind Quickbooks, has good informatrion for/small businesses. Thuis is but one link:
This is from Austratlia, but is valid for what youy are looking for:
Try Googling "procedures small business to check bookkeeping system accuracy".
Let me know if you have further questions.