Paperless Small Business/Home Finance Workflow?

I'm an IT contractor, small business, few customers, regular invoices. I've had a very paper-heavy workflow for years for home and business finances:

  • Print everything - invoices, remittance, receipts, bank statements, bills
  • Use filing trays - one for "to pay", one for "business to file", one for "home to file"
  • Periodically go through "business to file", enter it all into a spreadsheet for BAS etc, tick the paper items off, file them away

I have an accountant and deal with him via email, so end up scanning some items we receive on paper, add them to electronic documents and send him PDFs and spreadsheets.

Working from home now, I'd like to go paperless for this workflow. A naive translation of my current process would be something like:

  • Emailed documents - save bill attachments to "to pay" folder
  • Mailed documents - scan, save bills to "to pay" folder"
  • Save invoices, remittance, receipts, paid bills in "to file" folder
  • Go through "to pay" folder, pay bills, move to "to file" folder
  • Go through "to file" folder, enter into spreadsheet, move to "filed" folder

Problems:

  • I work from various devices, save my financial documents on a PC, so not easy to save attachments etc as soon as received, easy to forget/overlook something
  • Receiving a mix of paper and electronic documents. (I do have a flatbed scanner, but it's out of the way as it's bulky)
  • I rely on marking bills with paid dates and receipt numbers, and ticking off items on bank statements - don't want to miss anything. Harder to do electronically

Questions:

  • What sort of paperless workflow are you using?
  • Do you use a separate email account for bills?
  • If you scan documents, have you found OCR beneficial?
  • What software do you use if not a spreadsheet? Is GNUCash OK?
  • What naming convention do you use for documents, if any? Eg currently I save electronic payment receipts as <from_bank_acct> <to_company> <purpose> <amount> <date> - eg, "CMT1 ATO BAS2020Q1 1200 2020-04-01.pdf"

Comments

  • +3 votes

    I'm an IT contractor

    Aren’t you supposed to solve this kind of problem?

    Your process is basically any accounting software.
    Basic Xero can do all of that. Cloud based. Accessible from any browser. Super fast.
    Don’t even consider MYOB. Slow af.

    <from_bank_acct> <to_company> <purpose> <amount> <date> - eg, "CMT1 ATO BAS2020Q1 1200 2020-04-01.pdf"

    Jesus

    How has your accountant not suggested you any accounting software 🤦‍♀️

    •  

      Aren’t you supposed to solve this kind of problem?

      A classic case of the builder living in a run-down house.

      The accounting side is pretty straightforward, hence the spreadsheet. It's the workflow of handling and storing electronic documents that I'm more focussed on.

  • +1 vote

    Second Xero.

    You need to change your processes and get an accounting package like Xero. It'll do everything you are looking for, not the same as you currently do it, but better and more efficient

    •  

      Thanks, including the workflow of handling bills received but not yet paid, storing the electronic documents, receipt info?

      •  

        Yes. There is a bills module where you upload all bills and can attach scans and specify when they are due.

        Xero could connect to your business bank account to download daily transactions and the bills are marked as paid when the money leaves your account.

  • +2 votes

    I use Wave for my dads small business however just for invoices and expense recording. Very easy to setup, can import existing clients etc, you upload your scanned receipts or use their app to photograph/upload then categorise. Used to be able to link to your bank account to categorise transactions but now you have to upload the transactions manually - something I don't do.

    End of the year I print out the report sheets which contain everything our accountant requires.

    Also its free to use unless you want to offer credit card payments to your customers.

    •  

      Thanks, will have a look, it sounds good.

  •  

    I guess I'm trying to see how others are handling the workflow of receiving electronic documents - bills, payments, etc, as well as paper documents and converting them to electronic.

    Regarding Xero, will have a look, can see lots of people swear by it. I can't overemphasise how routine my billing and expenses is - one invoice a fortnight, a dozen or so receipts a quarter. Paying for Xero would streamline this presumably, but by how much?

    My main concern is lock-in to a proprietary solution and not being able to easily move to something else, hence using generic tools like spreadsheets, PDFs, etc.

    I've been involved in a number of systems migrations to and from commercial-off-the-shelf IT systems and the cost and frustration of vendor lock-in and extrication from it can be high, so I guess I was immediately dismissing commercial solutions for those reasons.

  •  

    Why Xero is an excellent solution for you is for reasons like:

    • automatic bank feeds from your bank account & credit card so you see what's coming in & going out
    • you can set up bank rules so you only have to specify once how a recurring payment or receipt should be coded
    • supplier bills can automatically appear in the Purchases area ready to be paid
    • multiple source documents in soft copy can be attached to any transaction in or out
    • soft copy docs eg. bank statements can also be kept in a general library, sorted by folders
    • GST is tracked automatically and BAS/IAS can be lodged online from within the software
    • your sales invoicing can be automated
    • your bookkeeper and tax accountant can be invited into Xero so you're all looking at the same data in real time & there's no need to send them copies of files

    I converted a couple of entities from MYOB to Xero recently and the 80 year old owner is raving about how it's made life easier.

  •  

    Shoe box works for me.