WELCOME TO D. CASTRO GROUP COR.
  • Home
  • Solutions
  • About Us
  • Blog

Why is so important reconciling your bank accounts?

10/9/2018

0 Comments

 
Picture
Why is so important reconciling your bank accounts?
You can always hear your bookkeeper whispering in you ear to send the bank statements on time. Why are they so obsessed? They are taking care of you and your business!
Why all the fuss about the reconciliation? Why is so important reconcile your accounts on time?
  1. Don’t forget to report all your income: reporting ALL your income is the best way to avoid audit and build a business that fulfill its responsibilities. It’s is your duty as a taxpayer to report all sources of income, and when you keep track of your income periodically you can make sure you are avoiding non-reporting penalties. On the other hand, measuring your income against your goals give you the answer if you are on the right track to reach your financial goals.
  2. Identify your personal contributions: when reconciling you need to distinguish your personal contributions from the business income. Remember to keep track of them and document the transactions to support your claims.
  3. Don’t forget to claim all your expenses: as important as reporting all your income is also identifying and reporting ALL your business expenses. When you claim all your eligible expenses you are reducing your taxable income and then saving on taxes. Review on detail you bank accounts, credit card statements and any cash receipts you have and send the to your bookkeeper on time. The expenses, of course, need to be all business related and supported by the proper source documents. https://www.dcastro.ca/blog/record-keeping-requirements-from-cra-perspective
  4. Keep track of receivables: comparing your sales and deposits at the bank helps you plan your cash flow, but also give you a rough idea of how much money are you owed. The best way is creating detailed reports and collect your funds periodically, but a quick look at your bank account and your invoices lets you know who well (or not) you are doing strategically.
  5. Avoid errors: not frequently, but the bank can make mistakes too. Duplicated transactions not cashed cheques, incorrect charges to your account. When you get into the habit of reviewing periodically your credit card and bank accounts charges you can detect these mistakes or fraudulent charges on time and deal with the bank accordingly.
  6. Be sure you have enough money: chequing your bank balances and debts give you the chance of savvy planning for the future. it's really important to know how much money do you have today and how much of that is owed to third parties. You can separate funds to pay HST, income taxes and save money for yourself and your business.
 
Reconciling your bank accounts gives you an amazing planning tool that can be using to improve the financial situation of your business. Making sure you report all your income and claim all your expenses can save you money, time and stress when the tax season arrives. You will be ready! 

Do you reconcile your bank accounts periodically? Are you using it as a planning tool? 

We can help!

Photo by rawpixel on Unsplash

0 Comments

    Author

    Dayani Castro, was born in Cuba, and is a proud Canadian citizen who pay her fare share on taxes and likes to contribute to the economy.

    In her own words: "I am from Cuba, moved to Canada 10 years ago with my daughter and we love it here. Won't go into politics but I took the decision to up-root my family to find better opportunities for my daughter to become a powerful and an independent woman. I open my bookkeeping and tax business 5 years ago, and love helping immigrants - specially women - navigate the process of creating and growing their business. As a single mom, immigrant an entrepreneur I recognize the importance of a supporting and loyal community when you need to start from Zero and build your dreams in your new country."

    Dayani's vision is to help as many immigrants as possible to create thriving business, giving them the opportunity to be independent, give back to the society and create new jobs.

    Archives

    November 2022
    March 2022
    February 2022
    January 2022
    February 2021
    July 2020
    May 2020
    April 2020
    March 2020
    January 2020
    December 2019
    January 2019
    November 2018
    October 2018
    September 2018
    August 2018
    August 2017
    February 2016

    Categories

    All
    Improving Business

Location
​
111 Catherine St, Ottawa,
​ON K2P0P4

Picture

Contact Us

    Get the Latest News:

Subscribe