Do you wait 8 weeks before you get your figures back from your accountant? Do you forget what you even gave them when you get it back to review?
There can be some issues with not getting on top of your record keeping. Have you considered what would happen if your bank froze your overdraft account because you haven’t supplied your financial statements in time? What about the cost of an audit from the ATO because you turn up on their radar as you are late submitting your returns?
Here are four tips for record-keeping to help your mortgage broking firm get ahead and stay that way. Although none of them are earth-shattering, they all add up to a part of your business that, if properly handled, will add more peace and certainty to your day-to-day business life.
FILING RECEIPTS
File all of your receipts, both business and personal, in separate categorised files. Keep separate tabs in a manila folder for your mortgage broking business, including:
- Bank statement covering the 30th of June
- Investment or shares statements for the year
- Loan account statements for the year
- Credit Card Statements
- Receivables/Debtors Reconciliation
- Payables/Creditors Reconciliation
- BAS returns
- Superannuation Reconciliation
- Hire Purchase/Lease contracts
- Inventory Reconciliation
- Sales Invoices
- Bills/Payments
Categorise and total your personal information also. Ideally, record all of your personal tax information on a spreadsheet and total them.
In the realm of mortgage broking, staying updated on loan progress is crucial. Utilising mortgage loan tracking technology can enhance this aspect of your business. This type of software aids in efficiently monitoring the stages of various loans, providing you and your clients with more accurate and up-to-date information. It's a practical tool in the fast-paced mortgage industry, ensuring you're always aware of where each client's loan stands.
ACCOUNTING SYSTEM CHOICE
Try to use a common accounting system like MYOB, Quickbooks, or Xero. Anything outside of the norm can create headaches for your accountant as each system has its quirks. It may look glossier in the store, but always ask your accountant what their preferred product is first for your mortgage broking firm. They may even have a discount available for you if you purchase through them.
QUALITY WORKMANSHIP
Remember the saying ‘garbage in, garbage out’? Customers who don’t have the skills necessary to enter data into their bookkeeping software create what we call the ‘computerised shoebox/shopping bag.’
To avoid this, ensure you have undertaken a training course with the accounting software product you have chosen.
Reconcile the bank account properly, and check the reports make sense to you each month. Look at the profit and loss report, balance sheet report, and cashflow report if your product has the capability, every week or month at the very least. Also, check your debtors and creditors reports make sense.
TIMING
Always check the date of each invoice and make sure it is in the relevant financial year. Again, it is a basic but very common mistake.
If your accountant has a schedule of when you should bring your work in, make sure you follow the advice. This has been done to smooth out workflow during the year. If you leave it to the last minute then invariably you will have longer delays.
This article is for general information only and should not be relied upon as a substitute for professional advice tailored to your specific circumstances.
