How do you track current accounts?

A current account is the record of the receivable-payable relationship between you and a customer or supplier. Account tracking is the job of keeping how much you are owed, how much you owe, and the due dates of these amounts current. Good account tracking is the foundation of your cash flow.

The limit of Excel account tracking

Starting in Excel is easy: a customer, a column, a balance. But problems appear as you grow. When an invoice is issued you must update the balance by hand; forget, and the number is wrong. A collection goes into another file. You keep a separate table to see overdue amounts. And everything lives in one person’s file.

What does software change?

In a pre-accounting program, the account balance updates automatically the moment an invoice is issued and drops when a collection is entered. For each account, the live balance, currency and overdue amount appear in one list. Most importantly, this data feeds from the same place as sales, stock and reports — no double entry.

4 common mistakes in account tracking

• Updating the balance by hand: it gets forgotten and wrong.
• Not tracking due dates: overdue receivables are noticed late.
• Defining the same account twice: the balance splits, no one knows the right number.
• Keeping collections separately: reconciliation becomes a nightmare.

The goal of account tracking is not just knowing the number; it is collecting money on time and protecting cash flow. For that, the balance must be live and in one place.