Accounting entry: how to reduce the risk of errors?

Accounting is an essential department within a company. Indeed, it concentrates a large number of activities that are essential to the smooth running of the company: accounting for incoming and outgoing financial flows, drawing up the tax return, managing customers and suppliers, settling disputes, paying employees, etc. The responsibilities of accountants are thus very numerous and the risks of error are just as great. This can range from a simple error in entering an amount to a duplicate transaction or one entered in the wrong account. But it is entirely possible to improve the performance of your accounting department by adopting the right solutions.

Here are some tips to help you minimise accounting entry errors. 

Accounting entry: how to reduce the risk of errors?

Digitalisation of the accounting department to the rescue

Identify sources of error

In accounting, there are several sources of error:

  • Human errors,
  • The volume of data is constantly increasing,
  • Forgetting or losing data,

Most of the time, these mistakes are fixable, but they can waste a lot of your time. Identifying them is therefore the first step to avoiding them.

Digitalising to reduce the risk of accounting errors

First solution Equip yourself with accounting software that really meets your needs. There is a wide range of software on offer today, but not all of it is suitable for your business. Do not hesitate to seek advice before adopting one of these tools for good. You should also make sure that the software offers certain functions such as programmed data back-up, the possibility of easily importing and exporting all your data, and regular updates to ensure that the tool complies with current tax regulations. Identify your needs beforehand in order to determine which features you will need.

Second solution if you already have accounting software:automate as many manual, repetitive and low value-addedtasks as possible. This means having the software do what is usually done manually. For example, this makes it possible to avoid common errors such as the inversion of VAT and the inversion of accounting entries. Automation allows your staff to have more time to deal with complex tasks. This will significantly reduce their stress and also limit the risk of errors on tasks that cannot be automated.

 

Save time on supplier invoices

Between collection, processing, validation and payment, processing supplier invoices can be an extremely time-consuming task for some companies. To save time in this area, you can use tools such as Freedz.

 

A unique platform for centralising 100% electronic invoices, Freedz helps you to manage your suppliers' invoices efficiently and automatically. This way, you reduce the risk of input errors and duplicate processing and can more easily validate the invoice for entry into the accounts.

By 2026, all companies will be required to receive and generate electronic invoices. This is a good opportunity to move away from paper and manual invoice processing now. 

Connecting accounting and management tools

To go further in the automation of tasks, new SaaS platforms, such as Freedz, can easily interconnect with your other management tools such as your ERP. Indeed, the whole point of using specialised software is that it can communicate and exchange data with each other. This saves a lot of time and can have a very positive effect on the company's performance. This may require a review of your information system, an essential step in the digital transformation of a company. transformation of a company.

 

Outsource or train your staff

It may seem obvious, but accounting errors are often due to a training problem. There are two solutions:

  • Outsourcing accounting,
  • Offer additional training courses to your employees

There are several advantages to outsourcing:

  • The employees, as well as the manager, can concentrate on their core business.
  • External accountants can provide additional expertise and advice on the company's financial strategy.
  • Calling on a specialised firm allows you to benefit from a quality service.
  • Depending on the size of the company, outsourcing accounting can be cheaper than having your own department.

Nevertheless, in many cases, the presence of an accounting department is more cost-effective for a company. And even with the help of an external service provider, employee training is essential. It allows them to better master the accounting tools but also to be up to date on tax regulations. As we mentioned in another article on false supplier fraud, awareness and training are often the first weapons to limit errors.

And as one benefit never comes alone, training also helps to reduce turnover in the department concerned.

 

As you can see, digitisation and automation are effective solutions for reducing the risk of errors and are highly profitable in the long term. It also allows your employees to have time to deal with complex and high value-added tasks.   

Accounting seizure: what is it?

Accounting entry is a legal obligation for any company. It consists of translating into accounting terms all the financial operations carried out by the company or which concern its assets. It also allows the tax authorities to obtain information on the management of the company. Accounting is generally the most reliable way of finding out about a company's performance.

Several journals are used to keep track of an organisation's financial activities. Transactions are listed in chronological order to facilitate monitoring. In this context, several documents must be entered:

  • Sales and purchase invoices,
  • Payroll logs,
  • Bank statements,
  • VAT declaration,
  • Tax notices,

In fact, each line of an account journal contains several pieces of information such as :

  • The date of the operation,
  • The amount,
  • The purpose and/or reference of the operation,
  • The account involved in the transaction,

Bookkeeping is usually carried out by people trained in bookkeeping but this is not essential. It is nevertheless important to have a sufficient level of knowledge to carry out the accounting of a company. It is a demanding job that requires a great deal of rigour. As in any profession, the person or persons responsible for this task must meet a certain number of obligations and may be held criminally liable in the event of intentional misconduct.

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