Bookkeeping is all about keeping tabs on where your business’s cash is. Here are a few handy tips that will ensure that your bookkeeping doesn’t require too much red ink so your small business can thrive:

  • Separate cash handlers. Be sure that the person who accepts cash isn’t also recording the transaction.

  • Separate authorization responsibilities. Be sure that the person who authorizes a payment isn’t also signing the cheque or paying out cash.

  • Separate the duties of your bookkeeping function to ensure a good system of checks and balances. Don’t put too much trust in one person — unless it’s yourself.

  • Separate operational responsibility (actual day-to-day transactions) from record-keeping responsibility (entering transactions in the books).

  • Reconcile the bank account. Assign this task to someone who is not handling cash or making bookkeeping entries. Review the reconciliation carefully.