It happens to the best of us. You mean to collect all of those receipts, you truly do; however life happens and before long the paperwork piles up and everything turns into this muddled wreckage. It just makes it harder and harder, the longer you ignore. Well, with a systematic approach you can certainly put your books back in order.
Stop the Bleeding
Initially, avoid making it worse. Hence, make a resolution that from today you are going to keep every receipt and record of all transactions whether paper or digital and not say you’ll do it properly later. Develop a system: A folder for receipts, or start with Excel sheets or Google Docs for transactions. Accounting software can also help. Alternatively, consider Tewkesbury Accountants like www.randall-payne.co.uk/services/accountancy/tewkesbury-accountants
Gather Everything
Put together all your financial papers in one place. From bank statements and credit card bills, to receipts or invoices or payslips – everything. You can worry about organising later on, just get it all together. Search your emails for electronic receipts and all statements in online banking.
Work Backwards from Now
Search from your most recent month, backwards. Recent transactions are easier to remember, and you should see results fast so as to maintain your motivation. Match transactions to receipts or invoices where appropriate when you reconcile your bank statements and records.
Categorise as You Go
Create different categories for things like office supplies, travel purchases, utilities bills, stock expenses etc as you make entries. Good classification here saves tax headaches later and helps to create meaningful financial reporting for your business. If you are unsure how to categorise, consult with your accountant.
Deal with Missing Receipts
You will not locate every receipt — and that is absolutely fine. Jot down the details of what you can recall for smaller sums. When possible, see if you can download copies of invoices or request for them via the supplier website (often with larger costs). In the case of small items HMRC will allow reasonable estimates following a full disclosure that you have genuinely made efforts to reproduce records.
Set a Realistic Timeline
Do not try to resolve everything in one weekend. Plan to spend a devoted hour or two, a few times per week until you are caught up. Consistent progress beats burnout.
Consider Professional Help
But if your backlog is substantial or you’re under a deadline, it might be good money to hire an accountant and have them just sort the mess. They might be able to recreate records faster than you and make sure everything is up to code.
