The Brief Guide That Makes Invoice Reconciliation a Simple Process
More than 55 percent of small business owners feel they aren’t very knowledgeable when it comes to their books. Accounting may seem complicated, but there are ways you can simplify the steps.
Do you sometimes wish there was an easy way to check invoices before paying them? Here are some tips to streamline your invoice reconciliation process.
Organize Your Process
A checklist is a simple way for a small business owner to list the steps required in the reconciliation process. It also ensures that you don’t miss any important details that might save you money. For example, you could add a step to take advantage of discounts for early invoice payment.
File the different types of invoices by vendor name and sort them by date when you receive them. If you use purchase orders, match them with the invoices. Create a system to follow for each step of the reconciliation process.
As you receive goods, check the contents of the packages against the shipping documents. Identify short shipments which can lead to partial payments. Circle any discrepancies and jot some notes down on the packing slip.
Follow up with a phone call to the supplier. Check the invoice and purchase order against the packing slip to validate the quantities received. File the packing slip with the invoices and staple any that match together.
Once you are sure that the amounts on the invoice are correct and the goods were received as ordered, approve the invoice for payment.
Verify Vendor Statements
When you receive a monthly statement from your vendors, you want to validate the total amount owed. Check each line on the vendor statement to verify the invoice receipt and check the amount.
Place a checkmark against invoices you’ve paid and note any questionable invoices. Examine line items that you are missing. Follow up with a phone call if there are any differences.
Upgrade Your Accounting Skills
Improving your business knowledge is part of responsible business ownership. Understanding the different ways things can go wrong with your invoicing makes it easier to see how you can prevent them. One great way to up your accounting game is to obtain a QuickBooks Specialist Certification.
Accounting software can catch errors when you use it properly. Learning about the different business processes can make it easier to find ways to improve your paperwork habits.
Automate Your System
Automation speeds up the reconciliation process for invoicing. It also keeps your records current, and you aren’t waiting for month-end to make your payments. That improves your relationship with suppliers and allows you to take advantage of early payment discounts.
When your system matches invoices to orders and receives documents, you’ll be more confident in your data. Better information allows you to improve decision-making.
Streamline Invoice Reconciliation Today
When you realize the importance of invoice reconciliation, you can test your processes with your bottom line in mind. As you bring the various steps together, you will create some checks and balances to save you money.
We hope you found some great ideas in this article. If so, use the search feature to check out more business tips.