Keeping your bookkeeping regular is essential for any size of charity. It does however become more important the larger your accounts are. Bookkeeping is the most essential part of the accounting system. With out it there would be no accounts available, no information for vat or gift aid returns and nothing to give you any indication of the financial health of the charity. Essentially bookkeeping relies on a process being repeated over and over to the same degree of efficiency and accuracy every single time.
Bookkeeping relies on process being repeated over and over to the same degree of Filling all documentation in an easy to follow system may sound like common sense (or like a really boring job) but it is necessary. Having piles of documentation all over the place leads to mistakes being made and information going missing. Not to mention the fact that confidential information should not be on display. Having an organized accounting system is especially useful when it comes to those difficult periods such as new staff members joining the team or perhaps some one off sick and you have a temporary member of staff in.
RECEIPTS AND PAYMENTS
All ways get two people to sign the cheque or if you are using internet banking make sure two people authorize the payment. Make sure large payments have been authorized by the trustees before arranging the payment to be made. Depending on the size of your charity you may want to allow your staff to make payments of a certain size with out the authorization of trustees. Trustees should be taking a high level strategic approach but you still need to make sure there are controls over large payments.
Another not so commonly used option for managing and authorising payments is allowing certain categories of payments to be made with out authorisation. For example Trustees could allow stationary,computer equipment and cleaning materials to be purchased with outauthorisation, but they may choose to have every payment to or for a beneficiary authorised by the trustees.
Always keep your receipts! As soon as possible make sure you put your receipts in a safe place to prevent any from getting lost or damaged. When entering receipts it is normally a good idea to make sure they cant get mixed up with receipts not yet entered. Scanning each receipt to make sure you have an electronic copy is a good way of protecting records. Unfortunately scanning receipts is a time consuming process especially if there are lots of small expenditure items. If you do scan receipts make sure you you keep all scans in a well organised electronic filing system. it is just as easy for electronic scans of receipts to go missing on the computer as it is with paper copies of receipts.
Obviously if you are a large charity with many employees accounting software of some type is essential to have for efficient bookkeeping. Software is improving and becoming easier to use along side technology in general. However finding software that is specifically aimed at charities is difficult as there is very limited choice.
For small or start up charities accounting software is not helpful and an unnecessary expense. Excel Spreadsheets can be put to good use when it comes to bookkeepingand take a surprisingly large amount of information.