The small-business finance tidy-up

Start with the accounts that hold the truth

List every bank account, credit card, payment platform, finance agreement and petty-cash balance used by the business. Check that each one appears in the bookkeeping system and that you can access complete statements for the period you need to review.

• Business current and savings accounts
• Credit cards and charge cards
• Online payment processors and marketplace balances
• Loans, asset finance and director loan accounts
• Cash takings and petty cash

Reconcile before you analyse

Reconciliation confirms that the transactions in your books agree with an independent statement. Without it, reports can contain duplicates, omissions or entries posted to the wrong period.

Work through one account and one month at a time. Investigate differences rather than forcing a balance. A balancing adjustment can make the numbers appear tidy while hiding the original problem.

Deal with the items that distort the picture

Keep a short query list for anything that needs evidence or a decision. This is faster and safer than guessing, and it gives an accountant or bookkeeper a clear set of points to resolve.

• Duplicate or missing sales invoices
• Old customer balances that have already been paid
• Supplier bills recorded twice or left unrecorded
• Personal costs paid through the business
• Unexplained transfers between accounts
• VAT posted with the wrong treatment

Build a routine that prevents another backlog

Once the records are reliable, choose a repeatable rhythm. Weekly invoicing and receipt capture, monthly reconciliation and a regular review of debtors, creditors and tax balances will usually prevent the same drift from returning.

• Use one place for receipts and supplier documents.
• Separate business and personal spending.
• Set a fixed weekly time for invoicing and credit control.
• Close each month before relying on its reports.
• Document who is responsible for each recurring task.