In Pursuit of Profit
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While it is advisable to keep all purchase receipts – personal and professional – a desire to reduce paper clutter and make the right choice environmentally has many people skipping the receipt altogether or asking for an emailed copy.
Too often business owners will forgo getting a receipt for a business purchase because they are in the habit of doing so with their personal transactions. Professionally, this is an unwise choice. There are many instances where receipts are an absolute necessity from a business perspective. For instance, expense reports, tax filings, and bank reconciliations all require receipt verifications.
Opting for digital receipts instead of paper is an environmentally responsible choice when it is properly executed. However, overzealous email marketing has turned many business owners’ inboxes into technological black holes. Too often business owners forget to comb through their emails periodically to enter digital receipts into their online accounting systems. Emailed receipts that go to spam folders can easily be overlooked, while those that are accidentally sent to incorrect addresses can be lost forever. In some cases, duplicate receipts cannot be generated from vendors, partners, and the like, resulting in a stressful situation for well-intentioned business owners.
When business owners do obtain physical receipts, it is easy to lose them, creating major accounting headaches. However, even when all receipts are present, if they have not been organized as they were acquired, mistakes can result. Expenses can be miscategorized, tax incentives may be overlooked, and cash flow can suffer.
Organizing receipts may not be the most glamorous to-do list line item, but it is certainly an important component for business owners. Use these six tips for organizing business receipts efficiently:
1. Let your Accounting Software Do It Automatically
2. Keep and Notate Every Receipt
3. Maintain a Consistent Method of Organization
4. Identify Tax Deductions Year-Round
5. Train a Backup
6. Keep Receipts for Tax Purposes
To avoid data loss in the case of a security breach, theft, or natural disaster all receipt records should be backed up to the cloud. Once receipts are no longer required, they should be discarded securely.
You don’t have to struggle with back-end office organization, especially regarding financial items like business receipts. We do not underestimate the importance of business receipts and expenses. We welcome your call or email to let us know how we can help!