Bookkeeping

When you’re managing your company using inniAccounts, it’s important to ensure all transactions on your business bank statements are captured. This process is called bookkeeping.

Bookkeeping is a key part of a company’s records so it’s important that you accurately record and match transactions in inniAccounts to your business bank statements regularly. Without this your LiveCash, tax calculations and company accounts won’t be accurate that could lead to overspending or incorrect tax payments.

You’ll need to update your bookkeeping regularly, especially before using financial information in inniAccounts or processing a dividend.

Bookkeeping in inniAccounts

We’ve designed inniAccounts to make bookkeeping as easy as possible. You’ll find many of your transactions are shown as ‘pending payment’ in the bookkeeping area – all you need to do is match them as they appear on your bank statement.

Step 1: gather your bank statements

You’ll need a copy of your bank statement for each of your accounts. If you use online banking you might find it useful to print off a copy of your statement.

Step 2: check the starting balance

The starting / opening balance on your bank statement should match the balance of the last transaction you’ve recorded in inniAccounts. If it doesn’t, you may have missed a transaction or two from a previous bank statement. It’s important to go back and balance your account before continuing.

Step 3: enter the transactions

You now need to work through your bank statement, from the oldest to the most recent transaction. You need to ensure that each transaction is captured in inniAccounts.

Whilst working through each transaction on your bank statement, you’ll need to :

• Check existing – If it’s already recored in your bookkeeping records, check the date, amount and it is included in your overall balance
• Match pending payments – If it’s in the list of pending payments you’ll need to match it, and record the date and amount
• Enter new transactions – If it’s not shown in the bookkeeping area or in the pending payments you’ll need to enter a new transaction

These are explained below.

Checking existing transactions

If the transaction is already shown in your bookkeeping area, check that the date and the amount match the details on your bank statement. If they don’t, simply click on the transaction, press edit, and update the details.

Matching pending payments

Pending payments are automatically created by inniAccounts for certain upcoming payments. They include payments you’re excepting to receive for invoices you’ve created, salary and dividend payments you need to make, tax payments due, and any recurring payments you’ve created in Regular payments & savings.

If the transaction is shown at the bottom of the page in the pending payments section, you’ll need to match it. Simply click the icon on the transaction and you’ll be asked to check and match the transaction details. Once this is done, press tick the matched to statement checkbox and press save.

Entering new transactions

If you have additional transactions that aren’t in the pending payments area simply press “enter company transaction” to create a new transaction.

You’ll then need to select one of the six options:

• Other outgoings – use this to record outgoings taken directly from your business bank accounts, for example bank charges, bills and other purchases.
• Other income – use this to record income where you haven’t created an invoice, for example income from blog advertising, interest on savings, etc. This income will be included in your VAT return.
• Refund of expense – use this to record when you receive a refund of an expenses, for example if you make a purchase and categorise it as a computer expense, you would record the refund and again select the category computer expense.
• Transfer to another account– this allows you to transfer money to another business bank account. If you are using a company credit card or savings account you should use this feature to transfer payment between accounts.
• Asset purchase – use this when purchasing an asset. The asset will be entered into your company’s asset register, as used during corporation tax calculations.
• Asset sale – use this when selling an asset. The asset will be removed from your company’s asset register.

You can then record the details of your transaction.

Step 4: check the closing balance

Finally, you’ll need to check the closing balance to ensure you’ve entered everything accurately. Simply look at the closing balance on your bank statement and ensure it exactly matches the balance shown again the last transaction in the bookkeeping area. If there’s a discrepancy, check your bank statement against the transactions shown in inniAccounts to find the incorrect / missing transactions.

Tips for bookkeeping

Don’t pay yourself without a payslip or a dividend payment

It’s important not to withdraw money for personal use from your company’s bank account until you’ve created either a payslip or a dividend.

Keep your balances matching

By ensuring that your opening and closing balances match the transaction in inniAccounts you can be confident that you’ve accurately captured all of your bank transactions.

Don’t withdraw cash from company bank accounts

Withdrawing cash from your company’s bank account can lead to surprise tax bills. If cash is an important part of your business please contact your account manager for further advice.

Getting extra help

If you’re behind with your bookkeeping our team are happy to lend a hand. You can upgrade to one of our services that includes bookkeeping or you can speak with your account manager about other options.