9 Bookkeeping Tasks You Should Be Performing Every Week
Business owners have plenty on their to-do lists, and it can be tempting to put off tasks that don’t seem pressing at the moment. Yet, letting certain responsibilities build up, like bookkeeping, can leave small businesses vulnerable to cash shortages, delayed payments, and disruptions to inventory.
There are bookkeeping tasks that need to be done on a weekly, if not daily, basis. Devising a system that works for your work style and schedule can help make the small changes to your habits needed to stay on top of weekly bookkeeping tasks.
Read on for a breakdown of essential bookkeeping tasks to keep your small business finances in order.
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The Complete List of Weekly Bookkeeping Tasks
Bookkeeping tasks provide the records and analysis necessary to understand a business’s finances. This list of bookkeeping tasks may seem daunting, but they’re doable with proper planning and scheduling. To start, here are nine bookkeeping duties you should do every week.
1) Enter and Pay Bills
Between utilities, rent, and invoices from vendors, small businesses bills can accumulate quickly. Vendors appreciate being paid on time, and staying on top of your bills is a clear way to build a favorable reputation and stay on top of finances.
Though many bills are due on a monthly cycle, others may be due upon receipt. Therefore, it’s important to review bills weekly to check for errors, note the deadline, and schedule payment accordingly. Besides avoiding late fees, paying early allows you to take advantage of early payment discounts (when provided in a vendor’s terms). Recording bills as a weekly bookkeeping task also makes it easier to check that accounts have sufficient funds.
For larger businesses, entering bills may fall within the scope of daily bookkeeping tasks.
2) Make Deposits
At minimum, small businesses should make deposits weekly. For businesses that receive most of their payments in the form of cash or paper checks, deposits can be made on a daily basis. Timely deposits are beneficial for maintaining cash on hand and up-to-date records.
For businesses that primarily collect electronic payments, mobile deposits may be adequate to handle the inflow of paper checks and save a trip to the bank.
3) Send Invoices
Getting paid on time by customers and clients is important for cash flow. Preparing and sending invoices every week, rather than at the end of the month, can help reduce the scale and frequency of late payments. Be sure to include a due date and payment terms to ensure clients know how and when to pay you; this will help if you have chronically slow-paying customers. Read our complete guide to accepting online invoice payments for more information about how to streamline the process.
4) Categorize Transactions
Knowing where your business is spending money is fundamental to managing finances. Categorizing each expense is a useful way to track spending. The types of categories depend on the type of small business and its needs. Some possible categories include the following:
- Employee benefits
- Rent or mortgage payments
Categorizing transactions consistently each week will help maintain accurate records and highlight any errors or red flags. This weekly bookkeeping task also saves time and dress if you choose to claim small business expenses when filing taxes.
5) Create Journal Entries
A journal entry in the general journal should accompany any financial transaction made by a business. This provides a chronological record of a business’s transactions.
Business journal entries generally follow the double-entry accounting method, meaning that a transaction requires balancing debits and credits across accounts. In this system, there are five types of accounts: assets, liabilities, shareholder’s equity, expenses, and revenue.
Using the purchase of a $1,000 point-of-sale system as an example, a business would debit their cash account (assets) and credit their equipment account (assets) for the transaction.
6) Review Inventory
Small businesses that sell products need to record and track the flow of their inventory. Performing a weekly inventory review is useful for identifying when more products need to be ordered. Having updated information on stock is also useful for identifying theft and letting employees know when an item is back in stock to avoid missing out on potential sales.
Certain aspects of inventory management are beneficial to do more frequently than on a weekly basis to keep updated information on stock. For instance, recording receipt and sale of inventory should be daily bookkeeping tasks for businesses working with higher sales volume or perishable goods. It can all get complicated quickly, so inventory management software that integrates with your bookkeeping software can be a lifesaver.
7) Run Reports
Creating financial reports should be on a small business’s bookkeeping tasks list. Some reports are advantageous to run on a weekly basis, while others can be done monthly.
- Accounts Receivable: This report highlights money owed to a small business, such as unpaid invoices. Keeping track of accounts receivable on a weekly basis can help businesses follow up on late payments in a timely fashion.
- Sales Report: Examining how much you’re selling of each product is useful for short-term decision-making, such as increasing stock of popular items or offering a sale or promotion to move inventory.
- Cash Flow Statement: This document measures how well a business manages cash flow, which can be thought of as its ability to generate cash to pay debt and cover operating expenses. It’s useful
- Balance Sheet: This statement reports a business’s assets, liabilities, and equity to give a snapshot of its finances at a specific point in time. At a glance, a balance sheet can show a business’s debt-to-asset ratio and net worth.
- Profit & Loss Statement: This shows how much money a business has earned after expenses have been accounted for. Since many expenses, like utilities and rent, are paid on a monthly basis, running a profit and loss statement once per month will likely give a more accurate picture of a business’s bottom line.
8) Review Timesheets
Small businesses with employees need to include payroll within their bookkeeping tasks. Reviewing employee timesheets each week helps keep track of their hours worked each week, which streamlines payroll calculations for wages, tax deductions, and accrual of benefits like vacation or sick days.
Payroll management software can help tremendously with this, and most of the major options integrate with leading accounting software apps like QuickBooks and Xero. There are even free payroll apps that can help you with basic tasks. The more tasks you automate, the easier your weekly bookkeeping will be.
9) Reconcile Bank Accounts
Instead of waiting for a monthly bank statement, businesses can reconcile their bank accounts every week. By simply logging into an online bank portal, businesses can compare the bank account balance against their book balance as frequently as they want. Performing this task on a weekly basis helps businesses promptly address any inconsistencies and detect fraud before it becomes a larger issue.
Don’t Forget These Monthly Bookkeeping Tasks
Alongside weekly bookkeeping tasks, there are some duties that should be performed on a monthly basis.
File Payroll Taxes
Depending on your payroll schedule, running payroll could be either a weekly, bi-weekly, or monthly bookkeeping task. However, paying employment taxes to the IRS is a monthly requirement for some small businesses.
According to IRS Publication 15, small businesses that reported less than $50,000 or less in taxes for the last lookback period make monthly deposits. Any business that reported more than $50,000 needs to make semiweekly deposits to the IRS. You can find the reported taxes for the lookback period on line 12 of the 941 form.
Send Invoice Reminders
Monitoring your accounts receivable will let you know if and when you’ll need to send a reminder for any remaining past due invoices. Contacting customers and clients once a month is reasonable for the initial reminder. If payment is significantly late and a reminder has already been sent, following up more frequently may be merited.
Pro Tip: Use Accounting Software To Manage Your Bookkeeping
Managing every aspect of your business can be challenging. Accounting software is a tool that can help automate and streamline your bookkeeping tasks list to save time and stress. While accounting software generally comes at a cost, it can help a business’s long-term success by providing financial insights in real-time and ensuring tax compliance.
There are plenty of choices when it comes to accounting software. The best option will ultimately depend on budget, desired features, and ability to integrate with other business software, such as payroll or HR programs. To help narrow your search, here’s our comprehensive review of the best easy accounting software for small businesses. If you’re looking for something basic, these free accounting apps may be up your alley. Freelancers usually don’t need the bells and whistles of a comprehensive accounting solution, but there are good accounting apps for freelancers, and we recommend using something other than just an Excel sheet to track your business expenses, even if you are doing the bookkeeping on your own without an accountant.
These days, the software options are pretty advanced and it’s possible to handle the books on your own, even if you don’t have any formal training. Not sure whether to hire an accountant or keep your bookkeeping to DIY? Our article, When To Hire An Accountant For Small Business may have the answers you need.