Account 4It Canada Inc.

Toronto, Ontario, Canada - Everything you need to confidently manage, track, and understand your finances.

Paul

Scanning & Claiming Meal Receipts

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Scanning & Claiming Meal Receipts is an important step in the business of bookkeeping.  The goal is to get 100% of the source documents to support an audit; and meals & entertainment is one area Auditors love to focus, especially once they discover you have insufficient documentation.

So what is required for proof of purchase?  Well the detailed restaurant receipt for starters, along with the credit card receipt showing the tip and total amount paid.  If you paid cash note any tip on the front of the receipt.

The receipt should have the following information:

  • Restaurant Name, Address & HST Registration number;
  • Date of the transaction;
  • Make a note of the person you met and reason for your meeting;
  • Show the tip and total amount paid.

By noting the details on the front of the receipt, it will be easy reference once scanned into your bookkeeping or Hubdoc accounts.  This also makes it easy for an auditor or business owner to quickly review later, without having to reference a diary or try to interview you later as to the details of the meeting.

By making the notes as the transaction occurs you can feel confident later should you have a review of your source documents by a year-end accountant or auditor.

It should be noted that there are special rules under certain circumstances, for example while attending a conference, convention or seminar and when the cost of a meal is included in a transportation fee.  It is best to review the Canada Revenue Agency’s IT-518R for specifics on unusual circumstances.

http://www.cra-arc.gc.ca/E/pub/tp/it518r/it518r-e.pdf

Happy Bookkeeping!

Forget that Password

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To say I have to remember a lot of passwords would be a little bit of an understatement.  Then I found LastPass,  and since then, I have forgotten more passwords than I have ever  remembered.

No matter the device I use, my passwords are saved and updated.  Another cool benefit is that I can share a password with anyone who has a LastPass account — and you can get one for free.

These days I have only one password to remember; anytime I have to quickly log into a clients accounts, LastPass has those passwords saved!

Try LastPass for free and see how easy it is to remember all those passwords!

Getting to know Your Credit Score

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That is my Saturday personal finance tip this week — pretty simple assignment to check yourself out with your local credit reporting agency.  Here in Canada we have two – one that has been in the news a lot lately – Equifax, and the other lesser known agency TransUnion.

Knowing your own credit score will allow you to monitor who is reporting  about you and can help prevent fraud and identity theft.  Your credit score affects many aspects of your life including when  you are applying for some jobs, purchasing insurance, and want to rent an apartment. If you decide to finance the purchase of a car or home, your credit score will also affect the rate of interest you pay; and a few percentage points can be a big deal on a $250,000 mortgage.

Credit rating agencies are a business selling you a product and they have plenty; however, in Canada the law allows you to check your credit report annually without a fee.  Finding that information on their website can be difficult – here is a link to TransUnions free reporting instructions and this is the one for Equifax.

You may be surprised about the information collected about you and your credit history.  Should you find errors or discrepancies on your report be sure to follow the agencies dispute resolution process to make the report right – it is about you after all.

Small business Big Bookkeeping Solution

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For any Entrepreneur or Small business owner the ease of your bookkeeping system is essential in allowing you to attend to the tasks of operating your business, without getting bogged down in data entry and document management.

Having tested many of the desktop and cloud based bookkeeping solutions available on the market, I recommend my clients use QuickBooks Online (QBO). QBO is an excellent solution to manage the bookkeeping and cash-flow of your small business, and is even a great solution for those looking to manage your household finances.

QBO is easy to use, flexible and once set-up correctly can be an integral part of an automated bookkeeping solution.  Use QBO with Hubdoc and thousands of other apps to streamline your bookkeeping system.

For those clients who currently use QuickBooks desktop, I like to caution that QuickBooks Online (QBO) is NOT THE SAME PROGRAM as QuickBooks desktop.  Both programs have their strengths, and share similar names; however, they are very different.  The greatest opportunity to using QBO is its ability to automate the bookkeeping process and decrease or eliminate a bookkeepers data entry – where many mistakes are made.

Whatever solution you decide on to manage your finances, be sure you invest to have it set-up correctly and in a way that you can easily extract the information required for year-end tax filing and reporting.  And remember if it is not saving you time and giving you the information you require, it’s probably not the right system.

 

Save Money Review Accounts

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This blog started out to be a personal finance tip; however, this advice is good for Small business owners as well as Household Managers.

Make an annual date to review your account plans for services like utilities, telecommunications, bank and credit cards.  Don’t overlook any long term bills especially those on auto-pay.

Companies change plans and update pricing regularly and there may be a better option available that you won’t know about without asking. With your current bill in-hand and a little bit of knowledge about what you are paying for, it will go a long way when you contact customer service to have them review your account.

Credit cards and banks are a great opportunity to save money.  First take a look at what charges you are paying for your basic bank account, there are free options on the market especially if you don’t need the services at a branch.  If you are carrying a balance on your credit card, consider switching to a low interest no frills card and then make an effort to pay off the balance as interest only is money lost.

By setting the date to review your accounts you can feel good that you are only paying for the services you want and need and getting the best deal available in the current market.  I remember my cell phone bill from the 1990’s, it was about three times that of my current bill, as the market has changed in the past 25 years!

Storing Source Documents in the Cloud

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Deciding where to store your receipts and other source documents can be confusing and necessary in case of an audit.  Let’t take a look at a few options.

One option is to simply scan your source documents and attach the copy to your bookkeeping software transaction.  This solution works if you are using QuickBooks Desktop, QuickBooks Online (#QBO) and many other bookkeeping software solutions available on the market.  The issue I have with this solution is that if you decide to change software or cancel a subscription for an online version, you wouldn’t have the supporting documents readily available in case of a government review or audit.

LedgerDocs is a simple solution that allows you to file in the cloud, similarly to how you file source documents in your office.  You can upload scanned documents, use their app to take a picture and post the transaction, or simply forward electronic receipts directly to your personal LedgerDocs account – this can then post to your online software solution — in my case QuickBooks Online.  This solution is cost effective (around $10/month (CDN)) and if you decided to cancel your online bookkeeping software solution you would still have an online version of your supporting documents.

Hubdocs is my preferred solution for online document capture and storage.  The simplicity of this app makes capturing pics of receipts a breeze.  Another benefit of Hubdocs is the ability to automate processes seamlessly with QuickBooks Online.  After the initial set-up you can program Hubdocs to post receipts without intervention — serious time saver if you have lots of little receipts.  Another benefit is that it automatically downloads bank and credit statements and also downloads the banks .csv file along with the supporting documents for e-transfers and bill payments.  This solution is a little pricier at $25/month (CDN); however, the time savings will pay for itself.

Finally you can use any of the other online cloud document storage solutions on the market.  Some include google docs, microsoft 365, dropbox, sugarsync, along with many more.  Some of these solutions work perfectly for simple document storage; however, if you are looking for a document storage solution specifically for bookkeeping than I suggest LedgerDocs or my personal favorite – Hubdocs.  It should be noted that both LedgerDocs and Hubdocs can be backed up to some of the other solutions like dropbox and google docs.

With your online document file solution in place you need to choose which cloud bookkeeping solution works best for your company.  In a future post I will review several including QuickBooks Online, Wave Accounting, and Freshbooks.  Also there is always keeping the desktop version of your current software.