Five bookkeeping habits that keep your accounts audit-ready

An audit-ready set of accounts is not built in December. It is built by five small habits repeated every month.

1. Reconcile bank accounts monthly

Not quarterly. A month of unreconciled transactions is an afternoon of work; a year is a week.

2. Keep source documents attached

Every entry should link to an invoice, receipt or contract. Cloud accounting makes this trivial — use it.

3. Separate business and personal completely

Mixed accounts are the single most common cause of qualified opinions in small company audits.

4. Record director transactions as they happen

Loans to and from directors reconstructed at year end are almost always wrong, and always questioned.

5. Close the month formally

Lock the period once reviewed. If figures can still change after review, the review had no value.