Bookkeeping is one of those tasks where there’s always room to tweak the process to make it more efficient. Fortunately, the National Bookkeeping Association keeps up on all the latest innovative bookkeeping ideas so you don’t have to. The NBA has offered some valuable tips and advice in their newsletters this past summer. Here’s a rundown of their finer points of bookkeeping:
Bookkeeping Skills Evaluation
This article spells out two ways to ensure that you hire qualified bookkeepers who can help the business run efficiently. One is to actively check references. Not all companies follow through and call references, yet this practice can offer valuable insight that may not be apparent in an interview. The second is to do pre-employment testing, ensuring that employees have the technical skills necessary for the job.
Depreciating and Amortizing Assets
When a purchase, such as equipment or insurance, lasts for a limited amount of time, it needs to be considered an asset and then written off during the specified period. For tangible assets this is depreciation and for intangible, it’s amortization. This piece does a great job explaining different methods of calculating and allocating these expenditures.
Adjusting Asset Valuations
For accounts receivable and inventory, sometimes you will not fully recover the value of an asset, meaning that you need to make a valuation adjustment in the books. This will take into consideration debts not being paid, inventory not selling, or other instances where you simply are not able to recoup expenses. This article explains what should be done from an accounting perspective in order to deal with these variables.