Taking shortcuts in financial management can cost you big
When that happens, things can begin to slide. You get lulled into thinking that banks and credit card companies don't make mistakes, and you find yourself not verifying all deposits or other transactions. Or you let several months of bank statements pile up, and then you rush to reconcile them so you can move on to the next month.
But taking shortcuts is not the answer. I should know; I'm a reformed shortcut taker.I believe I've seen every possible error, including some very costly ones. A few months ago, $1,500 was accidentally taken out of our account when another bank customer's client bounced a check. Then this month, two days of credit card deposits—worth more than $4,000—never hit the account. And they never would have if we hadn't developed good internal control systems.
Most of us know we need to act quickly when it comes to collecting accounts receivable. A harder lesson is that the same holds true when addressing banking errors. We wouldn't have picked up on the missing credit card deposits for four to six weeks if we still reconciled deposits when the bank statement arrived a few weeks after the months' end. By then, it would've been harder to determine what happened and potentially more difficult to retrieve our money.
Deposits are particularly time sensitive. For example, it's one thing to write up a daily deposit ticket, but the deposit still needs to get to the bank, which still needs to put the right amount in your account. And while it may be tempting to do evening drop deposits, most banks don't send receipts anymore. Yes, it takes someone away from the clinic to go to the bank during the day, but when you take this step, you have accountability and a receipt.
While a receipt is a good start, it's no guarantee. You should also verify weekly that your deposits hit your account. Web banking can expedite this process.
The bottom line here is that it's your bottom line. And if you don't look, you probably won't find anything wrong.
Veterinary Economics Editorial Advisory Board member Dr. Jeff Rothstein, MBA, is the president of The Progressive Pet Animal Hospitals and Management Group, which owns and operates hospitals in Michigan and Ohio. Please send your questions or comments to [email protected]