A Guide for Keeping Financial Records Accounting Department Workflow

1. A Guide for Keeping Financial Records Accounting Department Workflow

2. Binders Needed: • Invoices/Purchase Orders/Order Forms (copies of forms) • Sales Journal, Accounts Receivable (Excel spreadsheets) • Purchases (copies of forms) • Purchasing Journal, Accounts Payable (Excel spreadsheets) • Cash Receipts and Payments Journal (Excel spreadsheets) • Inventory Log (Excel spreadsheets) • Tax Forms (copies of forms prepared in Excel) • Payroll (Excel spreadsheets) • Bank Statements (copies of bank statements)

3. RECORDING A SALE Order information is entered into the SALESJOURNAL, ACCOUNTSRECEIVABLERECORD and the INVENTORYRECORDS. You receive a PURCHASE ORDER or an ORDERFORM (through your website, mail, or fax). Staple the PURCHASEORDER/ORDERFORM and INVOICE together and file in a binder in numerical order by Invoice. The Accounting Department creates an INVOICE. Send the Invoice to the customer. Order INVENTORY when needed. Note: Review the Invoice binder periodically and send out overdue reminders.

4. Order Form

5. Sales Journal Sale to Lizzie Grubman

6. Accounts Receivable Record Balance for Lizzie Grubman

7. Accounts Receivable Controlling Record Balance for Lizzie Grubman

8. Invoice

9. MAKING A PURCHASE You receive an invoice from the company. The Accounting Department records the information in the PURCHASESJOURNAL, ACCOUNTSPAYABLERECORD, AND ACCOUNTSPAYABLECONTROLLINGRECORD. Your company completes a PURCHASEORDER from another company and sends it out. Keep a file copy in the PURCHASES binder. The invoice and the original purchase order is forwarded to the Bank Manager. If the purchase was for inventory, update the INVENTORYRECORDS. The Bank Manager pays the bill, marks it paid, and files it.

10. Purchasing Journal One purchase

11. Accounts Payable Record Total Amt. One purchase

12. Accounts PayableControlling Record Total Amt.

13. Inventory Record Value of Inventory on Hand Total Units on Hand

14. Inventory Record Value of Inventory on Hand Total Units on Hand

15. Inventory Control Value of Inventory on Hand linked from Individual Records Quantity of Inventory on Hand linked from Individual Records

16. RECORDING CASH RECEIPTS AND PAYMENTS The Accounting Department records ALL transactions in the CASHRECEIPTSANDPAYMENTSJOURNAL in the appropriate places (as payments or receipts of cash and an explanation). Each week the BankManager prints out a copy of the current bank transactions. If one of the invoices that you sent out has been paid, retrieve the invoice from the binder, mark it paid, and file it. Update the ACCOUNTSRECEIVABLERECORD to reflect the payment. Any invoices that your company paid another company (because you purchased something from them) is updated in the ACCOUNTSPAYABLERECORD.

17. Cash Receipts andPayments Journal Enter in the Receipt or Payment Enter in the Explanation

18. Accounts Receivable Record Enter in payment received

19. Accounts Payable Record Enter in amount paid

20. PAYROLL The Payroll Associate completes the PAYROLLREGISTER for the pay period. The original is filed in a binder and a copy is given to the Bank Manager. The Payroll Associate creates and distributes pay stubs. On the 15th of the month, the Bank Manager submits and pays the 941 tax form for the previous month. All tax forms are filed in a binder. The Bank Manager pays each employee. Note: Payroll is completed twice a month.

21. Payroll Register

22. SUMMARY • Accounts Receivable, Accounts Payable, and Inventory Records are updated as needed. • Payroll is completed twice a month. • Bank Statements should be printed out at least once a week. • Cash Receipts and Payments Journal should be updated each time a bank statement is printed. • Tax Forms should be completed according to the calendar. • 941 – monthly • Sales tax – quarterly • W2 and W3 – yearly • 1040 individual tax return – yearly • 1120 Corporate tax return – yearly