According to Gene Marks, CPA and president and CEO of the Marks Group, “Everyone knows that successful managers are driven by data and that the devil’s always in the details.” That’s why he suggests printing and reviewing your company’s general ledger on a monthly basis.
The general ledger provides a record of every financial transaction. It holds all of the account information needed to prepare your company’s financial statements. Transaction data is segregated by type into accounts for assets, liabilities, owners’ equity, revenues, and expenses.
Some of the benefits of reviewing the general ledge include:
- Better management of expenses. You will know exactly how much you are paying your vendors and what you are paying them for.
- Ability to catch and correct errors. Reviewing payments made and expenses incurred may reveal mistakes or raise questions about cash flow that would otherwise go undetected.
- Ability to view activity for a specific time frame. Running a general ledger report allows you to view all activity for a very specific time frame in detail.