Running a small business is rewarding, but it comes with its fair share of challenges—especially when it comes to keeping your finances in check. For many business owners, accounting is one of those tasks that feels overwhelming, but it doesn’t have to be. That’s where the expertise of a small business accountant makes all the difference.
Ever wondered what ongoing accounting services involve? Let’s walk through a typical monthly checklist, giving you a behind-the-scenes look at how an accountant helps keep your financial house in order.
1. Reconciling Bank Accounts: A Foundation of Accuracy
Think of reconciliation as the starting point. Each month, your accountant will compare your bank and credit card statements with your business records to ensure every transaction is accounted for.
Why it matters:
- Catches errors like double charges or missed deposits.
- Identifies potential fraud early.
- Ensures your books reflect your actual cash position.
This step might sound routine, but it’s the backbone of accurate financial reporting. Without it, your financial data could be unreliable—something no business can afford.
Pro Insight:
“Reconciliation is the foundation of sound financial management. Without it, accuracy in reporting is impossible.”
2. Reviewing and Categorizing Transactions
Your business probably has dozens, if not hundreds, of transactions each month. Part of your accountant’s job is to review each one and categorize it correctly. Was that purchase office supplies or a marketing expense? It matters more than you might think.
Benefits of proper categorization:
- Provides a clear picture of where your money is going.
- Makes tax time easier by ensuring deductions are in the right place.
- Helps you spot trends, like overspending in certain areas.
Expert accountants don’t just look at numbers—they see patterns. By categorizing transactions, they can flag potential issues or opportunities you might not have noticed.
3. Generating Key Financial Reports
Numbers tell a story, but only if you know how to read them. Each month, your accountant will generate key financial reports to give you insights into your business’s health.
The big three reports:
- Profit and Loss Statement (P&L): Shows your income, expenses, and profit over the month.
- Balance Sheet: Summarizes your assets, liabilities, and equity at a specific point in time.
- Cash Flow Statement: Tracks the flow of cash in and out of your business.
These reports aren’t just for show—they’re tools for decision-making. Whether you’re planning a big purchase or strategizing for growth, having accurate reports is essential.
Key financial reports are not just documents—they are the pulse of your business, revealing its strengths and vulnerabilities.
4. Managing Accounts Payable and Receivable
An accountant doesn’t just keep track of what you’ve earned—they also help you manage what you owe and what’s owed to you.
Keeping your accounts receivable healthy isn’t just about collecting money—it’s about building relationships that pay off over time.
Accounts payable: Ensuring bills are paid on time keeps your suppliers happy and avoids late fees.
Accounts receivable: Tracking unpaid invoices ensures you’re not leaving money on the table.
This dual focus on payables and receivables keeps your cash flow steady, so you’re not scrambling to cover expenses.
Paying on time isn’t just about avoiding late fees—it shows your vendors you’re a partner they can trust.
5. Tax Preparation and Compliance
Every month, your accountant is laying the groundwork for a smoother tax season. That includes:
- Tracking deductible expenses.
- Ensuring compliance with local, state, and federal tax laws.
- Preparing estimated tax payments, if necessary.
By staying on top of taxes monthly, your accountant helps you avoid surprises when April rolls around. It’s not just about avoiding penalties—it’s about maximizing your tax position year-round.
Tax preparation starts on day one, not in April. A well-prepared accountant saves you money and headaches year-round.
6. Identifying Trends and Offering Strategic Advice
A good accountant does more than crunch numbers—they act as a financial partner. Each month, they analyze your data to spot trends and provide actionable insights.
For example:
- Are expenses growing faster than revenue?
- Is there a seasonal dip in sales you can prepare for?
- Are you consistently missing out on tax-saving opportunities?
Your accountant’s goal is to help you see the big picture, so you can make informed decisions and set your business up for long-term success.
As a small business owner, it’s easy to feel bogged down by financial details. But when you work with an accountant, those details become opportunities—opportunities to grow, streamline, and succeed.
Each task on this monthly checklist might seem small on its own, but together, they create a foundation for financial health and peace of mind. Whether you’re just starting out or running an established business, having an expert handle your accounting ensures you can focus on what you do best.
And the best part? You don’t have to tackle it alone.
