Michelle’s Bookkeeping Services (MBS)

Policies and Procedures

Index

Bank Account Reconciliation
Transaction Processing
Assets/Loan
Hubdoc Supplier Archival
Chart of Accounts
Insightly CRM
Accounts Receivable/ Payable
Payroll
ATO Compliance/TPB Registrations & Bookkeeping Associations
BAS/PAYG Withholding and SG Super Lodgements

Bank Account Reconciliation

• Policy: To ensure the accuracy of the business bank accounts records by providing a quarterly balance shown in the bank account register.
• Purpose: To outline best practices for preparation of a quarterly bank reconciliation to prevent fraud and assist with cash flow management.
• Scope: This applies to all bank accounts maintained by the business and will be reconciled quarterly.
• Responsibilities: MBS is responsible for reconciling bank accounts. The Business Owner is responsible for providing actual bank account balances to MBS.
• Procedures:
  • The Business Owner provides bank statement balances either to MBS on a quarterly basis.
  • MBS reviews the bank statements for any unusual balances. Any abnormalities are investigated further. Once all unusual balances are rectified MBS will reconcile the actual bank balance to the accounting software and will keep a copy for records management (Google Drive).

Transaction Processing

• Policy: To ensure the accuracy of each transaction processed in the Chart of Accounts.
• Purpose: To outline best practices for determining the correct category and GST coding for quarterly management reporting and BAS lodgements.
• Scope: This applies to all unprocessed bank feed transactions in the accounting software.
• Responsibilities: MBS is responsible for processing transactions from the bank feed in the accounting software. The Business Owner is responsible for providing any information including source documentation to assist MBS with the transaction processing.
• Procedures:
  • The Business Owner provides documents upon request to assist MBS with bookwork processing.
  • MBS processes transactions by matching off open bills/sales invoices or using spend money/cash deposits to allocate payments to correct chart of account category and GST coding.
  • Any bookwork queries are communicated to the Business Owner and responses actioned in the accounting software.
  • At the end of a Bas quarter the financial reports are reviewed for correctness of transaction allocations and provided to the Business Owner prior to BAS lodgment.

Assets/Loans

• Policy: To ensure the accuracy of assets/loans accounted for on the chart of accounts.
• Purpose: To outline best practices for reporting fixed assets purchased and any liability loans on the Balance Sheet for the Tax Agent.
• Scope: This applies to all major assets/loans for depreciation purposes.
• Responsibilities: MBS is responsible for recording fixed assets and loans. The Business Owner is responsible for providing documentation to MBS.
• Procedures:
  • The Business Owner provides documents to assist MBS with recording the fixed asset purchased and any loan associated with the asset purchase.
  • Source documents are attached to the processed transaction and a copy kept for records management (Google Drive).

Hubdoc Supplier Archival

• Policy: To ensure the source documents are stored on a third-party software for archiving purposes.
• Purpose: To outline best practices for storing source documents for auditing purposes and to attach such documents to the accounting software transaction.
• Scope: This applies to all requested supplier bills and expense receipt documents requested by MBS.
• Responsibilities: MBS is responsible for recording supplier bills/expense receipts via Hubdoc. The Business Owner is responsible for providing documentation to the Hubdoc software.
• Procedures:
  • The Business Owner uploads supplier bills/expense receipts into the Hubdoc software.
  • MBS process the document in Hubdoc which is then automatically integrated with the accounting software as an open bill or expense receipt.

Chart of Accounts

• Policy: To facilitate the record keeping process for accounting, all ledger accounts are assigned a descriptive account title and account code.
• Purpose: To provide the method for assignment and maintenance of the organization’s chart of accounts.
• Scope: This procedure applies to all ledger accounts used in the accounting software.
• Responsibilities: MBS is responsible for updating or adding new ledger accounts. The Business Owner is responsible for providing details of any required changes or new categories required on the chart of accounts
• Procedures:
  • All ledger accounts have titles and account codes to indicate specific ledger accounts e.g.: Motor Vehicle, Accounts Payable, Utilities.
  • All ledger accounts are grouped as Assets/Liabilities/Revenue/Equity/Expenses etc.

Insightly CRM

• Policy: To facilitate job management and tasks processes via a third-party software.
• Purpose: To record all project tasks such as bookkeeping processes & lodgements.
• Scope: This procedure assists MBS with each step of the bookkeeping process leading up to lodgment of the BAS.
• Responsibilities: MBS is responsible for ensuring all tasks are completed and reviewed.
• Procedures:
  • Jobs are based on the quarterly BAS lodgements
  • All tasks within the jobs are reviewed and actioned.
  • Communication with Business Owner is recorded.
  • Source documents are archived within the software.

Accounts Receivable/Payable

• Policy: To facilitate accurate sales and purchases figures are recorded in the accounting software to match outstanding amounts due and owed.
• Purpose: To record all sales income and supplier purchases to correctly estimate stock levels for revenue and inventory assets.
• Scope: This reports the business register and aging for cash flow projections.
• Responsibilities: MBS and the Business Owner will collectively record unpaid sales and purchases in the accounting software.
• Procedures:
  • The Business Owner and/or MBS records quotes/sales invoices either using the accounting software or external third-party software and emails out to the customer.
  • The Business Owner and/or MBS records purchase orders/supplier bills either using the accounting software or external third-party software.

Payroll Processing

• Policy: To ensure accurate payroll processing and STP filing to the Commissioner of Tax.
• Purpose: To record accurate gross wages/PAYG Withholding/SG Super/Deductions based on relevant awards in line with the Fair Work Act.
• Scope: This applies to all staff/directors/contractors employed by the business.
• Responsibilities: MBS is responsible for processing payroll and reporting via STP to the Commission of Tax. The Business Owner provides correct pay rates/hours of work in accordance with the employment contract.
• Procedures:
  • The Business Owner and/or MBS approves timesheets and leave requests in the accounting software.
  • MBS processes payroll based on the information provided by the Business Owner and files the pay run via STP.
  • MBS provides the Business Owner with completed payroll reports and EFT information.
  • The Business Owner and/or MBS will make EFT payment of net wages to the employee.
  • The Business Owner and/or MBS will lodge the SG Super within the required timelines either via the accounting software or nominated third-party. The PAYG withholding will be lodged with the quarterly BAS.

ATO Compliance/TPB Registration/Bookkeeping Association

• Policy: To ensure compliance with the ATO/TPB and Bookkeeping Association as per the Code of Professional Conduct TASA Act.
• Purpose: The “Code of Conduct” sets out principles required to act honestly and with integrity as well as complying with the Taxation Law in the capacity as a Bas Agent.
• Scope: Bas Agents are required to maintain registrations and provide continual professional education and hold adequate “Professional Indemnity” insurance
• Responsibilities: MBS is responsible for renewing registrations/insurances as they fall due. The CPE register maintains a record of knowledge and relevant skills completed during the registration period.
• Procedures:
  • The TPB renewal via an online software is completed as it falls due. The information provided ensures MBS meets the criteria as a BAS Agent.
  • The CPA register maintains a record of CPE activities completed throughout the registration period. (webinar/conference/newsletters/online knowledge courses etc)
  • MBS holds “Professional Indemnity” insurance which is renewed as it falls due.
  • MBS is a member of the ICB (bookkeeping association) this association provides materials/training required to keep up to date with tax obligations.

Bas/PAYG Withholding & SG Super lodgements

• Policy: Lodgements allows businesses to report SG Super, PAYG withholding income/expenses and GST to the government ensuring transparency and legal compliance.
• Purpose: To ensure all taxes including goods and services and payroll information is provided to the ATO within required timelines.
• Scope: Bas, PAYG withholding and SG Super will be lodged on a quarterly basis.
• Responsibilities: MBS provides the Business Owner with completed management reports as supporting documentation to the required lodgements. The Business Owner reviews the documents and authorizes the lodgements to the Commission or Tax and the Superstream Clearing House.
• Procedures:
  • MBS will commence lodgement of the BAS and PAYG Withholding and forward the details to the Business Owner for review and authorization. Once approved MBS will complete the lodgement and forward the details and payment slip to the Business Owner for payment.
  • The SG super is either lodged via the accounting software or via a third-party software. The Business Owner will review and pay the SG Super.