Record-keeping for businesses
Monday, January 16, 2012 by Wakeful Partners |
| Taxonomy: Hints / Tips, Industry News
With the introduction of benchmarking, record-keeping has become the name of the game when a taxpayer is audited so they can prove their figures are correct. The following is an excerpt from the ATO’s stance on record-keeping.
The ATO would expect a small business to:
- Record each individual sales transaction through their cash register or point-of-sales system;
- Conduct a daily sales reconciliation between the ‘z’ total (or end-of-day report if they use an electronic system) and cash in the register, taking into account cash taken from the register for business and personal expenses;
- Transfer the daily sales total into a cash receipts book regularly;
- Perform bank reconciliations between bank statements and the cash receipts book, at least monthly;
- Retain for a period of five years:
- the ‘z’ totals or point-of-sales system end-of-day reports;
- daily reconciliations;
- bank records and cash receipts book; and
- till rolls or end-of-day reports that record details of each individual transaction (if ‘z’ totals have been reconciled with actual cash sales and banking, detailed till rolls may be discarded after one month); and
- Maintain a filing system to keep track of paid and unpaid accounts.