Photo credit: Phoebe Say. Angel & Devil doodles added on iPad Pro using the Procreate app
Though we typically associate the iconic images of an angel and devil on one’s shoulders with concepts of conscience and temptation, I find this imagery coming to mind regularly in terms of bookkeeping. I know you’re thinking, “Well, that’s a bit of a stretch, Lori.”, and maybe you’re right but hear me out.
There are several industries where we’re forced to bare our souls as individuals in order to obtain the assistance we need to take good care of ourselves. Medical, legal and finance professionals require intimate details about our lives in order to provide us with the services, care and/or advice that we need to take good care of ourselves as individuals, the needs of our families or the needs of our businesses.
With business bookkeeping in particular, there’s no avoiding that in addition to the financial dealings of your business, if you’re running a sole-proprietorship or partnership we’re also going to be aware of your personal home and auto expenses because the percentage of business use for those items is important to calculate when preparing for tax filing each year. If you have not yet opened a bank account specifically for running your business, then your bookkeeper will end up seeing all of your personal transactions as well. Enter the angel and devil on your shoulders image.
As a bookkeeper, it’s my job to track, categorize, reconcile and analyze your business’s financial dealings or teach you how to take care of this effectively on your own. When businesses are still running all of their personal and business transactions through the same bank account, you’re unnecessarily sharing additional information with me that is not required in order to meet your business needs.
Every business owner that I meet and their own life circumstances are as different as each person’s fingerprints. How much you spend on extracurricular activities for your kids, your wine consumption or where you do your Christmas shopping doesn’t interest me in the slightest because it’s my focus to take care of your business. I’m involved enough in my own personal life that I’m not going to develop any judgements about how you live your personal life. Life is short. You do you. Eat the cupcakes. Drink the wine. I do.
There are so many reasons to have a dedicated business banking account for your business, not the least of which is preventing any grey areas that could raise flags with CRA, creating accurate business financial reporting each month, building a recognizable paper trail for the owner’s draw from the business, reduced transaction volumes to pay your bookkeeper to manage, and many more.
In my opinion though, one of the most poignant reasons to have a dedicated business account, is to avoid turning your bookkeeper into the angel and devil sitting on your shoulders.
The fine print:
The information and opinions expressed by Lori K Aitken on this blog are based on her own personal experiences. Please consult your own legal and accounting professionals for specifics regarding how any of the topics covered here may apply to your business’s unique structure, needs, or operational policies and procedures.
