How to Make Accounting More Efficient

It can be argued that cash flow is the most important part of a business. Accounting is responsible for monitoring and recording business transactions. Organizations should follow best practices to ensure the business’s accounting is efficient.

Payroll, taxes etc are all handled by the accounts department in an organization. The accounts payable process is extremely important. Apart from payroll most of the payments that an organization makes are through invoices. The accounts payable process is responsible for processing invoices and for sending invoices when the business is supposed to receive a payment. By analyzing the businesses finances over time the accounting department can recognize patterns and come up with ways for the business to save on costs or earn more profit. Accounting can impact a business’s efficiency and overall health (Brittani Sponaugle, IMPORTANCE OF ACCOUNTING: BASIC FINANCIAL CONCEPTS TO KNOW, 2014). Mentioned below are a few ways through which organizations can improve the efficiency of their accounting:

Cutoff Policies

Organizations should have a cutoff date for submitting invoices and recording expenses. Employees should be told that any expense invoices that they want to claim need to be submitted by a particular date. All purchase invoices should be approved and sent back to the accounts department by a particular date. This will reduce the amount of adjustments the accounting department has to make to the financial statements. Not having all the invoices on time also makes it harder for the accounts department to conduct quality financial analysis.

Periodic

Many organizations wait till they are close to the end of the financial year to reconcile their accounts payables and accounts receivables. It is easier to correct mistakes in the financial statements if the mistakes are caught earlier. Organizations should try to reconcile their bank records soon after the end of each month.

Bulk Processing

Sitting down to process a single invoice or check at a time can be counterproductive. A more efficient way of processing invoices and checks is to wait until there is a stack of items to process. The accounting executive can set aside a block of time and complete processing all the items that have accumulated at one go. Organizations should create a schedule for when invoices and checks will be processed. This can be done twice or thrice a month. This schedule should be shared with all relevant parties.

E-fakturering

Processing conventional paper invoices can be very time consuming. This process is also vulnerable to errors as it requires manual keying in of information. Organizations also have to maintain archives of these invoices. A more efficient way of taking care of invoice payments is the use of webbaserad fakturering.. This type of billing will give organizations easier access to their records. It is also more cost effective. One organization that offers consultation services and hjälp med fakturering is Basware.