This is the time of year when many businesses are busy closing out their books and preparing their records for tax returns. Accounting departments are buzzing with activity and executives are anxiously awaiting those final numbers.

Hopefully your business has practiced sound accounting procedures during 2009 and your year-end will go smoothly. If not, then now is the time to make sure that mistakes or poor business practices are not carried forward into 2010.  Here are a few suggestions to get you started off on the right track for 2010:

1. Keep your accounting/business software up-to-date, and use it! So many businesses rely heavily on spreadsheets or other programs to supplement their accounting procedures, even though their accounting software is capable of handling much more. Don’t get me wrong – I love spreadsheets, but they should not replace the checks and balances, automation, and consistency inherent in any small or mid-market accounting packages.
2. Review your chart of accounts and consider making changes if your business has outgrown the original chart. As businesses grow and change, they often find that they need to record their financial transactions in more (or less) complex ways. Since your chart of accounts is the backbone of your financial reporting, it plays a key role in business analysis. In short, make sure your chart of accounts fits your business.
3. Always keep bank reconciliations current. This is the ONLY way to ensure that the cash you show on your financial reports and the cash you have in the bank are the same. Every accounting transaction has a debit and a credit, and cash transactions are no different. If your cash is off – so is something else.
4. Use electronic data as much as possible. Paper documents such as invoices, statements, and correspondence can be obtained in electronic form and saved to your workstation or server. The documents will always be just a click away won’t require file folders or expensive physical storage.
5. Backup your data regularly. I cannot stress this enough! Computers are wonderful for business, but you cannot afford to depend on your computers and then skip backups. There are many backup options for businesses, including external hard drives and online services.