accounting files

The importance of having accounting files is so you keep the right information in an organized manner where you can easily find it, when you need it.  Isn't it frustrating to need something, know you have it, but aren't sure where you put it?  Especially if that something is a customer's purchase order and you're trying to prepare their invoice.  Or a tax bill that's due today.

Once upon a time, I had piles of paper on my desk, on the floor, on the credenza behind my desk, in filing cabinets beside my desk.  And when I needed something, I knew I had it, but where??  Can you relate?  How much time do we waste searching for things?

So I read a couple books on productivity and time management, and came up with a pretty good system of keeping my accounting files organized.  This has helped me find what I need when I need it.  This system uses a combination of Current Files and Reference Files.  (I need to give credit to David Allen and his book, Getting Things Done)

Accounting files - Current files

Some small business accounting info you need at arms reach, because you'll need to access if daily, or at least weekly.  These files should be in a desk drawer, or in a desktop file stand, like this one.

Or, if your office is wherever you open your laptop, consider one of those file boxes you can carry like a little suitcase, or a rolling cart with hanging folders in it.  If you're really techy, you may consider scanning all your paperwork and keeping it stored somewhere safe in the cloud (if that's, I mean).

If you're not sure what you should keep in your current files, take a few minutes and jot down your regular activities.  Or take a week, and note which paperwork you reach for time and again.  These are good candidates for your current files.

If you have employees, your payroll files will need to be handy (but secure).  You'll need a file for orders or jobs to be completed.  You'll also need a job for materials or products you purchase regularly, and a file for open purchase orders.

Other suggestions for your current file are:

  • checking account information
  • loan paperwork
  • bills to pay
  • deposits to post
  • credit card account information
  • payroll and benefits paperwork

These can be kept in files in your desk, or somewhere that is easily accessible.

Within your Current Files, you can also keep a couple of other files that will help you keep things straight.

  • Waiting On - in this accounting file, you can keep any projects that are waiting on something before they can be completed, or anything you're waiting for someone to get back to you on.  Don't let this file get lost, though.  Make a note in your planner/schedule to refer to this file every few days to keep things moving.
  • To Read - if something comes across  your desk that you'd like to check out, but you don't have the time right now, put it in this folder.  When you have a few minutes, like when  you're waiting for a meeting, grab this folder and get caught up.  Or take it home at night and catch up on your reading while the kids watch their favorite Disney movie for the 10th time.

accounting files - reference files

Reference Files are for information you need to keep long term.  You may need to refer to these files from time to time, but not on a daily or weekly basis.

There will be accounting files and legal information on your business that you need to save.  You need to keep loan info, warranty info, lease info, etc.  Keep these in Reference Files.

Take a file cabinet, or a couple of cardboard file boxes if you don't have much room.  Put hanging folders in there for each letter of the alphabet.  Put manila folders in the hanging folders.  Use a manila folder for each grouping of items as needed.

Don't worry too much about which letter you put it under, there will only be a couple options when you go looking.  For example, if you lease a Jeep vehicle, and you file the lease paperwork, you may use "L" for lease or "J" for Jeep.  But it's still easily found.  Just don't put it under "B" for blue. 

Some info that's a good candidate for your Reference Files would be:

  • lease agreements
  • past loans paperwork
  • purchase agreements
  • contracts
  • building information
  • customer files
  • vendor files
  • vehicle information
  • warranties
  • employee files
  • legal business
  • business taxes
  • taxing authorities files (IRS, State, Local)

Think about how much of a load this will take off your mind.  You no longer have to worry about where everything is.  It's in one area, and all filed, all easily searched.

I also suggest you keep a file drawer or box set aside for accounting report files, too.  These will be your monthly files for bills, invoices, check stubs, bank statements, and reports.  More on this in the next section.

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