Accounts Standard Operating Procedure

Accounts Standard Operating Procedure

Accounting plays a very vital role in managing any business and provides a fair indication of where the organisation is actually heading.  If you never thought about accounting then spare a moment and think of this scenario: You plan for a holiday with your best buddy after a long time and plan to make this trip by car. You did not know how much of fuel you have in your car and nothing to indicate its presence, then probably you do not know how far you could go and if you did not have a provision to check and control it means you are out of this plan. The same is applicable to your business that you are into. The way the expenses and incomes are accounted directs the course of your business as you go.

Some key advantages of inculcating best accounting practises means:

  • Your organisation is in safe hands as far as compliance with law is concerned. It means the right taxes and tax components are being paid on time. Also the money to be spent on safety aspects can be clearly planned and executed. This way in case of any accidents or issues there is evidence of compliance adherence and lesser chances of other related complications. Even during the times of legal scrutiny if the book of accounts is in good shape the organisation can be safe.
  • Healthy accounting practices will throw light on the cash flowing into your business enabling organisations to plan for better budgets. Through the budgets decisions on how to sustain and grow the business can be well thought of. In fact budgets can be thought of as blueprints to ultimately allow one to grow businesses to greater stability and affluence.
  • Accounts will throw insights to understand the business’s past history and learn lessons to take better decisions in future. Through the review of the financial records one can clearly see where the money of the company is going in addition to seeing what good happened. Also newer areas with little expenses upfront can bring larger dividends on the longer run can be deciphered.
  • Ultimately all businesses are run to generate profits and this is based on the road built by the key management decision makers within the organisation.  The economic landscape prevailing in the market your organisation is currently into can be better unravelled.  Sometimes for strategic decisions like whether certain work can be carried out in-house or whether to outsource from else can be better decided if accounts are maintained properly.

Having seen the importance of accounting in a business set-up let us see the how SOP can be of use. SOP or standard operating procedures provides to creating a better structure in an organisations business activity thereby explaining the expectations of the management while doing certain activities.

The employees on job need not guess what needs to be done any more once the SOP is in place but rather follow a procedure which is made easy through a simple print-out or a reference link in the portal of the organisation. In fact through SOP certain measurable aspects of the accounts are clearly spelt out for monitoring and tracking on a continual basis.

List of Recommended Accounts SOPs

SOP-AC-001-Travel Advances
SOP-AC-002-Petty Cash Handling and Management
SOP-AC-003-Cash Management & Transactions via Cheque Within a Region
SOP-AC-004-Payment Acceptance by Cash
SOP-AC-005-Wire Transfer Related Payment
SOP-AC-006-Procedures for Banking
SOP-AC-007-Procedure for Accounting
SOP-AC-008-Bank Reconciliation
SOP-AC-009-Payroll Processing
SOP-AC-010-Invoice Payment Procedures
SOP-AC-011-Month end Accounting Procedures
SOP-AC-012-Recognising Revenue
SOP-AC-013-Revenues and Expenses Matching
SOP-AC-014-Cash Receipts
SOP-AC-015-End of Year Accounting Procedures
SOP-AC-016-Maintenance of Accounts Related Passwords
SOP-AC-017-Back-up of Accounts Information
SOP-AC-018-Budgeting Procedures
SOP-AC-019-Internal Control and Financial Audit
SOP-AC-020-Loans and advances to Staffs
SOP-AC-021-Travel Reimbursement
SOP-AC-022-Employees Insurance
SOP-AC-023-Bills Receipt
SOP-AC-024-Approval Procedure for Payment Release
SOP-AC-025-Cheque Dispatch
SOP-AC-026-Employee Benefits
SOP-AC-028-Accounts Payable
SOP-AC-029-Accounts Receivable
SOP-AC-030-Overseas Payments
SOP-AC-031-Dividends Pay-out
SOP-AC-032-Duplicate Cheque Issuance
SOP-AC-033-Duplicate Bill Creation
SOP-AC-034-Miscellaneous Payments