There are many common errors found in bookkeeping processing. Some of these are:
- Work vehicle registrations not being split between the GST on the insurance premium, and the GST free component of the registration fees (page 4 of the registration notice);
- Insurance not being set up correctly, with the errors continuing for the whole of the repayment payment period. The result of this error is the insurance showing twice in your accounts;
- Insurance monthly payments are not separated from GST premium and non-GST stamp duty;
- Suppliers not registered for GST, but GST being claimed. This especially relates for contractors. You need to check their ABN each time;
- GST being claimed on entertainment expenses;
- Licences & fees e.g. ASIC, QBCC, TRC, are generally GST free. Check the supplier invoice. Better still, upload the invoice directly to your software system to make checking of the entry less time consuming;
- Bank accounts not balancing at the end of the month;
- Are you keeping records of small purchases? There’s now software that can upload information as soon as the purchase is made (EFTPOS or CC);
- Not keeping business and private expenses separate.
While these might sound trivial, if done year after year without correction, can leave your file in a mess. If not fixed each quarter, this will add to your accountants’ time at the end of the financial year preparation of the financial statements. If not corrected on your software, the balances of your accounts will continue to be incorrect.
Also, in most cases these days, you are paying good money for your software so you really do need to make the most of it. If you cannot rely on the reports from your software to present to the bank, or any other interested party, at any time, you need to speak to your bookkeeper and/or accountant to have these errors corrected each month.