One ground principle you must never forget

There’s no excuse for this and what’s even more, you’ve got to retain those documents for 5 or so years, depending on your local legislation. Yes. If there’s no source document for an expense than how did you know the amount to account for? Or to which account it should go to – is it really rent? I know that keeping source documents is something we’ve discussed over and over again, but it’s really important.

It’s important and yet it’s neglected and not considered as one at the spot but considerably regretted later on. Trust me on this. Keeping things on track with having source documents for each entry, referencing them properly to the entry itself and storing those documents whether physically or electronically in the end makes your life a lot easier.

So please keep this one rule in mind – have source documents for each entry. For each entry in your accounting make sure it states the sums the entry is made in, the reason for the entry or what the entry is about and most importantly that it’s also referenced to the entry (i.e. the entry has the same document number than the source document carries).