Rules to Better Accounting

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Rules to Better Accounting
  1. Do you know how to claim expense reimbursements?

    ​You should be reimbursed for all reasonable expenses incurred in carrying out your duties, which are above your normal costs, to and from the office.

    A common example is bus and train fares to client sites. Amounts under $40 should be reimbursed through Petty Cash.

    Remember to treat your company's money like your own and minimize costs where possible. Try to search around for a better price before committing to a purchase.

    All expense claims must:

    • Be work related
    • ​​Be made within a week
    • Be signed by the claimant and authorized by the relevant Manager
    • Be supported by Tax Invoices
    • Not include alcohol, as it incurs FBT
    ​​
  2. Does your company cover taxi costs?

    Traveling around Sydney can take time and your time is best spent doing billable work in the office or at a client site. Taking a taxi is perfectly acceptable, if it is going to save substantial time, compared with taking public transport.

    This is applicable to travel between client sites or the office and a client site. Work does not pay for taxi travel from home to a client site, or home to the office. Remember to always obtain a Tax Invoice from the taxi driver so you can request for reimbursement later on.

  3. Do your cheque and memo fields have a good description?

    If your descriptions have good comments then you don't need to go back to paperwork to investigate things.

    e.g.  The period the invoice relates to.

    memo field bad example
    Figure: Bad Example
    memo field good example
    Figure: Good Example
  4. Do you print out your general ledger for the week and ask your boss to initial?

    In your first month as an Accountant for a new company, you should print out the general ledger for the week and ask your boss to initial to say that the "cheque numbers and memo descriptions are good".

    It's good to catch any mistakes early, so that you know the requirements early on and don't have to go back and fix up large amounts of data later.

    Do whatever you have to do e.g. drive to your boss' house to get this done! It can save you days of work down the track.

    General Ledger.jpg
    Figure: Weekly ledger
  5. Do you do know the best technical solution to enable purchase approvals?

    This is one of the most common workflows that every company needs.

    Companies have employees who make purchase requests, then business rules get fired, then you wait for approval.
    E.g. If less than $1K, then your direct manager can approve.

    Unfortunately, no one has an out of the box solution for this, so here are your choices:

      Choices:
    • TFS 2012 (too hard)
      You can have requests go in as a work items but there is no workflow service that runs on the server, so the workflow would have to be in a separate web service using WF4.
    • SharePoint 2013 (recommended)
      SharePoint doesn't have an out of the box solution. To configure it, have the purchase requests go into SharePoint lists and then the workflow service that runs on the server (using WF3 under the covers) can have business rules added.
    • CRM 2011
      CRM also needs an out of the box solution. You can have requests go into as CRM Entities and there is a workflow service that runs on the server, using WF3 under the covers.​
    • JIRA
      Jira supports workflows and approvals, like SharePoint, but it is not .NET

    Suggestion to Microsoft: Please provide an out of the box solution for CRM and SharePoint, so we don't have to configure this for each client.

  6. Do you have Monthly Financial Meetings?

    ​It is important to have monthly meetings​ to get an overview of where the company finances are throughout the year.

    Since different people need to report for different sections, it's a good idea to split this into 2 meetings.
    In this meeting, key staff members should review the past month and look at forecasts for next month. ​

    Here is a sample agenda:

    Pre Meeting:
    1. ​Reconcile invoicing system with Accounting system
    2. Print Monthly Profit and Loss Report
    3. Print YTD Profit and Loss Report
    4. Print Monthly Profit with graph
    5. Complete and print current cash position and include previous signed version
    6. Review invoices that should be cancelled or removed
    7. Fix any invalid data
    8. Print Monthly Receipts Report
    9. Print Invoices vs Receipts by financial month
    10. Print Expenses by Financial Month Report
    11. Print Snapshot Report - Monthly and Cumulative Data
    12. Print Profit and Loss Return % Report

    Note: the pre meeting section should be done the day before meeting #1, and a lot of it can be delegated to admin employees


    During meeting #1:

    1. Review Sales reports
    2. Review billable leaderboard
    3. Review utilization report for the month
    Note: It's a good idea to record a quick summary of​ this meeting so people in Meeting #2 know the executive overview.

    During Meeting #2:

    1. Review Cash Position
    2. Review revenue by client
    3. Review monthly invoices and receipts
    4. Review monthly profit with graph
    5. Review monthly expenses
    6. Review monthly profit and loss
    7. Review trends year on year
    8. Review trends profit contribution %
    9. Review profit and loss return %​
  7. Do you know how to enter an expensify receipt ?

    Expensify is great for tracking receipts, but if you don't use it the right way the reports can be hard to reconcile.
    ​​expensify-receipt-1.png
    Figure: Bad Example - The purpose for the purchases is not clear, and there are strange columns of numbers.
    The only content field displayed is the Merchant - so this field needs to display everything the person doing the reconciliation requires. Also, if care isn't taken with the categories, the report is hard to read
    ​​expensify-receipt-1-good.png
    Figure: Good Example - The purpose for the purchase is clear and each expense is categorized clearly
    ​​expensify-receipt-2.png
    Figure: Bad Example: No category is selected so the report will not be well organized, and all the important details are in the 'Comments' field which isn't shown on the main part of the report
    ​​expensify-receipt-2-good.png
    Figure: Good example - all important details required on the report are in the Merchant field, an appropriate Category is selected, and no important information is in the comments field

  8. Do you pay invoices completely?

    If you negotiate with a supplier in relation to an invoice, do you ensure the invoice is reissued?

    It is not always common but sometimes you will negotiate a change in the agreed price once an invoice has been issued by a supplier. This might be because there was a change or defect in the good or service provided and a lesser amount is agreed or an agreement that a certain amount of the invoice will be paid later when the rest of the product or service is delivered.

    Do not pay an invoice in part. You should ask the supplier to reissue the invoice or issue a credit note in relation to an invoice. Otherwise, the supplier may say that there is a balance of the invoice owing.  

    “Jim. OK, I'll just pay $165, not the $220 on the invoice"

    Figure: Bad example

    “Dear Jim, Please reissue the invoice or provide a credit note for the now agreed correct amount." 

    Figure: Good example
  9. Do you use Expensify for expenses?

    ​Tracking expenses can be a painful process of accumulating receipts and entering them into outdated systems… but there is a better way:​

     

    Expensify is a timesaver, both for the day to day user, as well as the accountant receiving the expenses.

    ​​As a user, all you have to do is take a photo of the receipt from your mobile app and add a comment (all other data is pulled in via OCR “Smart-scan”), then all of these expenses get batched together and sent on a weekly basis to the accountant, who can then manage them in bulk. 
    Best of all… for light users… it’s free!​

    expenses-bad.jpg
    Figure: Bad Example – Concur (the next best alternative) has no free version
    expenses-good.jpg
    Figure: Good Example – Expensify has a free version