Categorising Wages and Superannuation

Many clients who do their own bookkeeping make this common mistake over and over when reconciling wage and superannuation payments.

What clients do:

Allocate/Reconcile the payment transactions to the expense accounts.

By doing this, it doubles up the expenses in the Profit and Loss that have already been reported through the payroll system and leaves the liabilities as still owing in the Balance Sheet.

This common mistake will show an inaccurate financial position.

What clients should do:

Allocate/Reconcile the payment transactions to the liability accounts to clear liabilities owing in the Balance Sheet to ensure an accurate financial position.