Information Centre


Why is Bookkeeping Important?

Bookkeeping helps you keep better informed on how your business is doing and where it is in relation to your budget. It will also provide information for income tax, income tax planning requests from lenders, as well as, prepare for the possibility of CRA audit. Whether you are using Wheatlandís bookkeeping service, that of a family member, or doing it yourself here are some tips that will save your bookkeeper time and you money.

  • Use one bank account and one credit card for farm business and use a separate bank account and credit card for your personal.
  • Transfer amounts from your business account to your personal account and pay personal amounts out of a personal account.
  • Pay expenses by cheque, debit card or farm credit card and deposit all sales into the farm account. This makes it possible to balance your records to the bank and credit card account and ensure that there are no expenses or income missing. You may miss something when expenses are paid by cash or income is taken in cash as there is nothing to balance to.
  • Use a deposit book. Write on the deposit slips what each item is for and staple the deposit slip to all the income receipts that are included.
  • Use the memo part of your cheque to describe what expense is being paid.
  • Record the date paid and the cheque number on paid invoices.
  • Write on the receipts/paid invoices what the expense is for (IE. home or building repairs, equipment repairs, tools purchased, new projects such as building new corrals or shop.)
  • Receipts or invoices should be issued in your business name and include the sellerís GST number, if the item includes GST.
  • Provide information/documentation on the preauthorized withdrawals, new equipment or asset purchases and loan/lease payments.
  • For purpose of farm programs, be sure that the physical quantity of grain, livestock and forage sales and purchases are recorded on the receipts.
  • Have one central location for keeping receipts and set up a monthly filing system until they are recorded into your records.

Regardless of who is doing the books, these steps will improve accuracy and the relationship with your bookkeeper.