This continues our 10-part series of best practices for business owners.
Best Practice 4: Reconcile bank and credit card statements monthly
Who needs to reconcile bank and credit card statements? Just go online and look at the balance and you can see how much money you have, right?
Reconciling your statements also gives you peace of mind that you know how much money is really coming in and where it is going. This makes identifying fraudulent charges and keeping tabs on who is handling the money that much easier.
In addition, reconciling your statements ensures you capture all of your income and expenses, and it is necessary in building accurate financial documents. These financial documents, such as a profit and loss statement, balance sheet, or cash flow statement, are not only necessary to prepare taxes at the end of the year, they can be used to make smart profitable decisions in your business.