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Accounting software – don’t drown it with data

A business called us for help with their accounting software but when we dug a little deeper the software was not the problem – the process was.  A simple problem to solve but some interesting lessons to learn.

The business has a weekly payroll with over a hundred people on it and so they have 400 – 600 net pay payments each month and all of them appear on the bank statement. They are accounting for each payment manually and wondered if there was a software solution to take some of the pain away.

They can download their bank statement from their online banking system into a spreadsheet. Their accounting software is QuickBooks 2013 and so one solution could have been to use the batch entry facility in QuickBooks to account for each payroll payment. Our short video explains how you do this.

But there is a simpler answer – just account for the total of the net pay payments!

Keep it simple and save time and money

All they need to do is download the bank statement for the day in which the net pay payments appear, add them up in the spreadsheet and account for the total net pay payment. They need to save the spreadsheet with their calculation clearly set out in case they or the auditors wish to review it later and because it contains the detailed analysis of an accounting entry.  But the details can remain in the spreadsheet and do not need to be replicated in the accounting software.

They should, of course, reconcile their bank account in QuickBooks to their bank statement every day to ensure the accounting has been done completely and accurately – but they should have been doing this anyway.

So by simply thinking a little differently about the problem and changing the process we were able to help this business to save hours each year without any loss of financial control. They can now make much better use of their bookkeeper’s time.

In Blue Dot Consulting all of us have worked in financial roles in companies like yours and we tend to have a different, more practical approach to accounting and financial management.  This situation is a good example of the benefits of our approach.

Can we help your business? Give us a call on 020 7125 0270 if you think we can.