The first week in any accounting system decides how much you trust it later. A short checklist for bank accounts, expense categories and opening balances.
Most frustration with accounting software comes from the very first week rather than from the software itself. If bank accounts, expense categories and opening balances are set up thoughtfully, everything that follows - reconciliation, reporting, tax - gets easier.
1. Create one record per real bank account
Add each account you actually trade from, in its real currency. If you hold a shilling account and a dollar account, they are two records, not one. Mixing currencies into a single account makes every later report misleading.
- Name accounts exactly as they appear on your bank statement.
- Set the correct currency for each account before posting anything.
- Keep mobile money wallets as separate accounts if you reconcile them separately.
2. Enter opening balances once
Your opening balance is the position on the day you start using DavoBooks. Enter it deliberately, on the right date, and do not use opening balances to correct day-to-day mistakes later - that is what adjustments are for.
Record opening receivables for customers who already owe you money and opening payables for suppliers you already owe. Without them your balance sheet will look better than reality.
3. Keep expense categories in a shape you can report on
A long list of near-identical expense categories is the quickest way to make reports useless. Aim for a list a new staff member could use correctly without asking.
- Group by purpose: rent, utilities, transport, salaries, marketing, professional fees.
- Attach supporting documents to expenses as you record them, not later.
- Record expenses against the account that actually paid, so reconciliation stays simple.
4. Reconcile early and often
Reconcile the first month within a few days of the statement arriving, while the transactions are still fresh in someone's memory. A monthly habit takes minutes; a yearly catch-up takes days.
The payoff
Once accounts, balances and categories are right, the reports you and your accountant rely on simply work: trial balance, profit and loss, cash flow and customer ageing all fall out of the same clean data.