Accounting Checklist: Tasks to Do Daily, Weekly and Monthly

Daily accounting tasks

Creating a daily routine for accounting tasks goes a long way in improving the accuracy and effectiveness of your company’s books. Here are some recommended tasks you should complete each day:

1. Refresh and update your financial data.

The best POS systems automatically sync your bank and credit feeds and sales data with your accounting software. If yours doesn’t, you’ll need to do this manually. Refreshing and updating your financial data gives you a current look at your accounts and shows you the money moving in and out of your business. 

It is essential to do this every day because it’s easier to spot discrepancies with recent transactions.

2. Reconcile cash and receipts.

Reconciling cash and receipts at the end of each day helps you quickly discover cash shortages or overages. You can then determine where the money went and identify errors, employee fraud or theft.

Reconciling cash and receipts will also help you establish controls and accountability in your organization, which may break down if not tended to regularly. 

3. Review and reconcile transactions.

If your accounting software is connected to your bank and synced daily, there’s no need to wait for your monthly bank statement. Many accounting applications simplify reconciliation by suggesting matches, so all you have to do is review and approve them. 

Spending a little time on this task daily is easy and eliminates a grueling month-end chore. It’s also a good time to review pending transactions for errors or abnormalities, allowing you to investigate potential issues promptly.

4. Record and categorize expenses.

Many accounting software programs have apps to help you and your employees fill out expense reports and integrations with receipt-tracking software. These tools simplify the process of recording and categorizing expenses, allowing you to issue reimbursements quickly. Instead of sorting through a stack of receipts at the end of the month, you and your employees can just snap a picture of the receipt and jot down the details.

5. Record inventory received.

Entering inventory into your system the same day you receive it keeps your system current, giving you a more accurate look at your stock. Without this level of inventory management, your staff may lose sales by telling customers you’re out of stock when an item just hasn’t been entered into the system. Also, if your staff sells out of an item, reordering may be delayed if your system isn’t set up to allow negative inventory counts.

Tracking inventory daily is also an important control measure that reduces theft and merchandise loss.

Weekly accounting tasks

Here are some weekly accounting tasks to keep records, cash flow and business operations running smoothly:

1. Record payments you receive; deposit cash and checks.

If you receive paper checks and cash payments, deposit them weekly to keep your cash flow healthy and your records up to date.

If most of your accounts receivable are electronic payments and you have just a few paper checks, see if your bank accepts mobile deposits and ask about its daily, weekly and monthly deposit limits. Mobile deposits can be a significant time-saver that eliminates trips to the bank.

2. Invoice your clients.

Billing clients regularly helps ensure timely payments. The product or service you provided is still fresh in their minds, and if there’s any discrepancy with the bill, it’s easier to talk about it sooner rather than a month later. The longer you wait to bill your client, the more time it will take to get paid. 

While daily invoicing may not be possible, invoicing clients weekly will foster prompt payments and strengthen your cash flow.

3. Review employee time sheets.

Reviewing time sheets proactively at least once each week can help you spot discrepancies and activities that may be counterproductive to your organization. It will also help you track payroll expenses so you can adjust your labor mix and stay within your payroll budget.

This practice can help you avoid the issue of unauthorized overtime pay. If an employee works more than 40 hours a week, you can be held liable to pay for overtime even if you didn’t authorize it. Weekly checks can ensure such surprises are minimized.

Monthly accounting tasks

To preserve records and maintain the integrity and reliability of your accounts, here are some tasks that must be performed each month:

1. Pay vendors, or at least schedule bills to be paid.

When you receive bills, review them for errors. It’s also essential to understand your vendors’ payment terms. For example, if your vendors offer early payment discounts, schedule your payments early to take advantage of them. Otherwise, set payment reminders so you can pay your bills on time and avoid late fees.

Ideally, vendors should offer 30 days to settle payments. However, you can often negotiate longer terms if your company is short on cash.

2. Track budgets and variances.

Creating budgets for various expenses, activities and projects isn’t hard, but sticking to them can be difficult. The best way to reduce budget variances is to check for such things each month and then work toward corrective action.

3. Back up your data.

If you’re not using cloud-based accounting software that automatically backs up your data, ensure you back up your financial data manually at least once each month. This will give you peace of mind that you won’t lose your data if you have a hardware failure or file corruption.

One advantage of manually backing up your data is that you can revert to an earlier version if you deleted something you shouldn’t have. It also allows you to discover errors that would be easier to fix by going back a few days and reentering data instead of making significant adjustments.

Automatic backups don’t allow you to revert to a previous version, but they do take care of this task for you.

Annual accounting tasks

Annual accounting tasks are primarily geared toward regulatory and compliance requirements and shareholder performance reporting.

1. Prepare your year-end financial statements.

Toward the end of the year, it is imperative to assess the company’s yearly financial performance and current financial health. This is determined by preparing accounting reports, including the profit and loss statement, cash flow statement and the balance sheet.

These statements are prepared based on the records maintained throughout the year, and their effectiveness depends on the accuracy of those accounts.

Taking stock of your company’s performance and health is essential for further planning and strategizing, so you must ensure the data presented is accurate. 

2. Complete an audit and year-end tax returns.

Once the financial statements are ready, the law requires them to be audited by an independent external auditor to assess their accuracy and completeness before presenting an unbiased audit report that will be used by banks, lenders, shareholders and government agencies.

This audit must be performed each year by certified professionals, and such independent audits add more value to your business than the regulatory requirements alone. Annual audits help test and assess various controls and procedures, and suggest necessary changes to improve efficiency or meet industry standards.

Based on the audit report, your tax liabilities are determined. These must be filed each year in March or April. You’ll need to pay the pending amounts in addition to the quarterly taxes.

Best accounting software for completing daily, weekly and annual accounting tasks 

The best business accounting software can streamline your daily, weekly and annual accounting tasks while helping you manage your finances and fiscal health. When choosing accounting software for your business, consider your budget and specific needs. 

The following platforms are excellent options:

• QuickBooks Online: QuickBooks Online is a popular, affordable and trusted accounting software option. Its features will help you calculate tax deductions, create invoices and track expenses. Our QuickBooks Online review details features like expense and profitability tracking and robust invoicing.
• Xero: Xero is a great option if you want your accounting software to schedule payments and automatically add sales tax to your invoices. Read our Xero accounting software review to learn about its unique one-click payment option for invoices.
• FreshBooks: FreshBooks is an accounting software solution that can handle your routine accounting tasks while providing everything you need to run payroll. Our FreshBooks accounting software review explains how you can integrate your payroll records with all financial reports to ensure accuracy. 

Good accounting today means less work tomorrow

From checking your financial data daily to preparing year-end financial statements, healthy accounting practices make life easier. When you know your financial tracks are covered, you can focus on the exciting aspects of running your business and bringing new ideas to life. Get into the habit of reviewing your accounting checklists regularly so nothing catches you by surprise later. 

Natalie Hamingson and Lori Fairbanks contributed to this article.