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Collins & Co Chartered Professional Accountant Victoria BC www.collinsco.ca

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cpacanada.ca
MEMBER
Chartered Professional Accountant

We see
more than numbers.

Record Keeping

     
  One of the greatest mistakes made by business owners is not keeping good financial records and making poor business decisions based on inadequate information.

Collins & Co can help you tailor your bookkeeping and accounting system so that it will work for you.

An excellent bookkeeping and accounting system is an absolute must for any business. It is the foundation of the PLAN FOR SUCCESS.

The record keeping system does not have to be elaborate. The simpler the financial record is the better.

Business Expenses:

  • A business expense must be reasonable and incurred with the expectation that it will earn income.
  • Receipts and vouchers must be retained, you cannot claim them if you don't have them.
  • Make sure the date, the payment amount and who you made the payment to is clearly written on the receipt as well as if it was paid by cash, credit card or cheque (include the cheque #).
  • File the receipts in the accounting year that they were created according to the headings used in the bookkeeping system.

Meals and Entertainment:

  • The meal or entertainment expense must be for a business purpose whether income is earned or not.
  • Record the date and client name on the receipt.
  • You may claim only 50% of the expense amount paid.
     

Bank Account:

  • Maintain a separate business bank account for company deposits and cheques.
  • Deposit all revenues intact to the account before disbursement.
  • Whenever possible pay all expenses via cheque or credit card so there is a third party record.
  • Reconcile the account monthly.

Assets:

  • Maintain a permanent record of assets for calculation of amortization.
  • Assets are items that are greater than $200 in value.
  • Small tools below $200 in value are capitalized in a special class with a 100% amortization schedule.

Business records and supporting documents must be maintained for 6 years. Do not destroy records without consulting us.

 
     

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PLAN FOR SUCCESS
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Home | Contact | Why Choose Us? | Services | Record Keeping | Incorporate? | Financial Control | Getting Started | Business Plan | Income Tax Checklist | Links | Privacy

Collins & Co Chartered Professional Accountant Victoria BC
www.collinsco.ca
Serving the accounting needs of the Victoria BC Business Owner since 1989

Call us for a free 1/2 hour confidential appraisal before you buy, sell or expand a business.