Datasheet

Maintaining Good Accounting Controls
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easily be able to steal cigarettes and also adjust inventory records
through cash register sales for cigarettes. Nevertheless, wherever you
can segregate physical custody from accounting, a built-in error check-
ing occurs. The person doing the accounting indirectly checks on the
physical custodians’ caretaking of the asset. If the physical custodian is
stealing cartons of cigarettes, for example, that will show up when the
accountant compares the accounting records to the physical accounts
of inventory. Similarly, someone without access to the cash and the bank
account can’t actually easily steal cash even if they have complete access
to cash accounting records. You can ask your CPA for help in devising
ways to segregate physical custody of assets from accounting and book-
keeping duties. And you really, really should do this. Unfortunately,
employee theft is very common.
✦ Train employees in the use of QuickBooks. You should train employees
to use QuickBooks if you have a business of any size for two basic reasons:
• Someone who knows how to use QuickBooks is less likely to make
inadvertent errors. QuickBooks isn’t difficult to use, but neither is
QuickBooks something that you can learn willy-nilly with no help.
Some transactions are pretty tricky, particularly for certain busi-
nesses. So, if you can, it makes good sense to provide some employ-
ees with help or training or both. Those resources let people more
comfortably and more accurately use QuickBooks features to build
financial information that lets you better manage your business.
• Messy accounting records camouflage employee theft. Often, one of the
things you see when employee theft happens is really messed-up
accounting records. For that reason, you can find yourself in a situa-
tion where poorly trained employees create a messy accounting
system that enables theft by perhaps one of those employees or
some other employee. So training not only means more accurate
accounting records, but also that you are less likely to have an envi-
ronment conducive to theft or embezzlement.
✦ Manage your QuickBooks accounting system. I am sorry to report that
many business owners don’t view the accounting system as anything
more than a tool to produce invoices and paychecks and information
required for the annual tax return. Unfortunately, that distant relation-
ship with the accounting system means that business owners often
don’t feel much need to actively manage what happens with the
accounting system.
In my opinion — er, an opinion based on more than 25 years of experi-
ence working as a CPA — this attitude is wrong. An accounting system
should be a tool that you use to better manage your business. And it can
be that. But if it’s going to be a tool for better managing your business,
you need to manage the system. In other words, I respectfully suggest
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