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Office work and accounting – tips and advice

Below, we present some tips and advice on how to organise your office work, accounting and business administration. You'll also find information on the tasks that must normally be carried out.

Bookkeeping

Bookkeeping is defined as an update of the account specification (general ledger) and of customers and/or suppliers (subsidiary ledger). This means that bookkeeping consists of debit/credit posting.

Documentation

The Norwegian Accounting Act describes documentation as:

  • Documentation of posted information. It can be vouchers, invoices, packing lists, contracts or electronic documents.
  • Documentation of the accounting system. An overview of how the accounting system is built and functions should be available.
  • Documentation of the balance. You must have documentation as of the year-end, which documents that the balance sheet items are correct.

Cost coding of vouchers

Decide which cost code in the account each purchase and sale should be registered with, and enter this on the documentation.

Accrual

Decide which period purchases and sales should be registered in. An item you sell and deliver before the New Year this year, but invoice after the New Year, should be included in this year’s account. Accrual under the VAT rules may differ from that under the rules for tax and accounts (ask your consultant).

Authorized accountant

Accountants who undertake to keep accounts for others must be authorized by the Financial Supervisory Authority of Norway.

These pages are intended to give you some tips and advice on how to organise your office work, accounting and business administration. It's important that you have good routines and take the necessary time  to do your office work. If you're organised, you can serve your customers better, and it will probably also reduce the amount of time you actually spend on office work.

They also contains some tips and advice on which tasks that must normally be carried out. You can also ask an authorized accountant or auditor for their advice. They'll be able to help you tailor solutions for your particular business.

The following are tasks commonly performed as a part of accountancy. Tick the box for the tasks you're sure you can perform yourself.

Add an account code to a voucher

Decide how to treat purchases in connection with VAT

Decide if an expense allowance should be reported, and if it's subject to withholding tax and employer’s national insurance contributions

Decide if major purchases of machinery and equipment should be capitalised or expensed

Post accounting information

Prepare an accrued income statement and balance sheet at regular intervals

Specify purchases/sales against counterparties

Reconcile accounts for bank, cash and public expenditure

Reconcile open items in customer and supplier specifications

Prepare statutory documents which must be sent to the Norwegian Tax Administration and the Brønnøysund Register Centre

 

0 – 9 ticks:

If you do not already have an authorized accountant, we recommend that you consider outsourcing all or parts of your accounting.

10 ticks:

You probably have the skills you need to prepare your own accounts. Do you have the time?

Make sure you have a written agreement with your accountant specifying which tasks the accountant should do, and which tasks you have to do yourself. Talk to the accountant about this.

You can also obtain information from Regnskap Norge or Økonomiforbundet.  You can also get relevant information from the Brønnøysund Register Centre and Lovdata.

It may become expensive and time-consuming to tidy up finances where the business and private finances are mixed. A systematic divide is important in your everyday work.

A separate account for the business

Open a separate account for the business. Pay all expenses related to the business with funds from the business. Do not use your private account.

Private withdrawals once or twice a month

Withdraw money from your business for private use in larger amounts once or twice a month. If your enterprise is organized in the form of a private limited company, private withdrawals are normally seen as salary payment. This should be based on a written contract of employment

Prepare vouchers

Make vouchers for private withdrawals from and deposits to the business. These internal vouchers must provide the same minimum information as other documentation, such as the parties involved, amount, quantity and dates.

In many businesses, the customer pays cash for purchases. Establishing good routines for handling and documenting cash will help to ensure that no money is lost and that you can adequately account for your income to the tax authorities.

Two petty cash boxes

Use two petty cash boxes. Use one cash box for the day’s cash sales, and one box for paying bills. The fixed petty cash box (for bills) could for example contain NOK 5,000, and there should then always be cash or paid bills totalling NOK 5,000 in this cash box. The amount you need to have in your fixed petty cash box will depend on the extent of cash purchases. The fixed petty cash box must be settled at least every accounting period, so that vouchers are sent for inclusion in the accounts under the appropriate period. Once you have used up the cash, withdraw money from the bank, so that you once more have NOK 5,000 in the fixed petty cash box. Withdrawal receipts and bills can be placed together with other vouchers that must be entered in the accounts.

Cash sales deposited in the bank

Cash that you receive should be deposited in the bank at regular intervals, e.g. daily. Speak to your bank about their night safe schemes or other similar schemes.

Register every sale on your cash register system

You must enter cash sales on your cash register as soon as the sale is made. Remember that the customer must be given the register receipt and that you must have a receipt roll in the cash register. Those who are required to keep accounts who make occasional or itinerant cash sales not exceeding three times the national insurance basic amount during an accounting year are not obliged to register their sales on a cash register. Instead, these people can document their cash sales on an ongoing basis in a bound book with pre-numbered pages, or through copies of dated pre-numbered sales vouchers. In the case of outreach sales to people attending sports events, concerts, etc., daily sales from each individual salesperson can be registered as a single amount in the cash register, and no receipts need to be printed for customers.

You must balance the cash drawer daily

When the day is over, you must print or save an overview of the day’s transactions in the cash register (Z report). You must count the cash in the cash register every day. The cash amount and the report from each payment terminal must be reconciled with the information from the Z report.

You must explain any discrepancies. State the name of the person who counted the cash holding and reconciled the cash sales.

All incoming and outgoing cash payments must be registered daily

Other incoming and outgoing cash payments must be registered daily wherever possible. Such incoming and outgoing payments could include salary for employees, withdrawals for private use, payments to suppliers, repayments of money you have lent to employees, etc.

Document incoming and outgoing cash payments

Make sure you also keep vouchers for incoming and outgoing payments in addition to sales. If the nature of the transaction is such that you do not receive a voucher, you should then write an internal voucher, explain what the amount concerns and make a note of important accounting information.

Your vouchers will form the basis and provide documentation for your accounts. It's important that you retain all vouchers so that all transactions are posted and documented. Accountants often discover that some vouchers are missing, but not  which ones. You may find it both time-consuming and difficult to locate these vouchers later. This might cause you to lose your entitlement to deductions from income or value added tax.

 You should therefore make sure to keep an overview of all your vouchers:

  • Keep your vouchers in a folder and insert the vouchers in the folder as soon as you receive them.
  • Agree with your accountant how the vouchers should be sorted.

A common way of sorting vouchers is as follows:

Type of voucher

Sort order

Outgoing invoices/income documentation (sales)

Numerical

Incoming invoices (purchases)

By date/alphabetical

Cash register vouchers

By date

Bank

By date

Miscellaneous vouchers

By date

 

If you have many bank vouchers, you should distinguish between incoming and outgoing vouchers. If your business has several bank accounts, these should be sorted separately.

If you supply goods or services on credit, it's important that you print out invoices as soon as possible after you've delivered them. Experience has shown that poor invoicing routines can result in some businesses forgetting to invoice deliveries. In other cases, we have seen that invoices with insufficient information may lead to the tax authorities increasing the income on a discretionary basis.

Print sales documents (invoices) as soon as possible after the goods/service has been delivered. The general rule is that sales documents must be issued no later than one month after delivery. The best arrangement is to print out sales documents on the same day as delivery takes place.

Sales documents must be pre-numbered and provide at least the following information:

  • Date of issue
  • Parties (seller and buyer)
  • Nature and scope of the service
  • Time and place of delivery of the service
  • Price and payment due date
  • Any VAT and other taxes linked to the transaction which is being collected as laid down by law or regulation. VAT must be specified in Norwegian kroner.
  • Your organisation number. If you're registered in the VAT Register, you must add the letters “MVA” after your organisation number.
  • If you need to correct a sales document after dispatch, you must issue a credit invoice.
  • You should retain incorrectly completed sales documents, but you must mark them as cancelled, so that the number series for the sales documents remains intact and you can see which sales documents are not to be included in the accounts.

Sales documents must state the buyer’s name, address or organisation number, as well as the seller’s name and organisation number. In the case of cash sales from retailers, the seller does not need to state the buyer. This does not apply when the buyer is required to keep accounts and the goods or service is intended for resale or as direct input goods in production processes or service delivery. If the payment is made in cash amounting to NOK 40,000 or more including VAT, the name of the buyer must also be stated.

If the seller is registered in the VAT Register, “MVA” (VAT) must be stated after the organisation number.

In order to be entitled to deduct expenses in your tax assessment and to deduct input VAT, you must present relevant documentation. Purchase documents are therefore very valuable.

An invoice of NOK 12,500 could entitle you to deduct NOK 2,500 from your VAT payments and at least NOK 2,500 from your tax basis. In total, an invoice for this amount would be worth over NOK 5,000 and should be treated accordingly.

Complete expense vouchers

As a buyer, you are entitled to receive a expense voucher with correct information. This documentation also forms the seller's sales documentation, and it must show the buyer’s name. In the case of cash purchases from a retailer, the seller does not need to list the buyer if the purchase sum is less than NOK 1,000 including VAT, and the goods or services are not intended for resale or as direct input factor in production processes or service delivery. If the buyer’s name is not specified on the voucher, the buyer must state the purpose of the goods or service, and the documentation must be dated and signed. If an employee has an outlay on behalf of the business for a purchase, the threshold amount of NOK 1,000 does not apply. In such cases, the employee must document the purchase and explain the purpose. The documentation must be dated and signed

 

It is often necessary and mandatory to use various help systems. Both in order to provide customers with good service and to maintain a good relationship with important business partners and the public authorities. For example, it would harm a doctor's business if he was unable to keep track of his appointments, or if a tradesman did not manage his assignments well. In the event of a complaint, it's important to have an overview of what has been agreed and, for example, the number of hours that have been spent on a job.

Withdrawals and sales to owners and partners

The Bookkeeping Act requires withdrawals to owners, partners and your own business to be specified. The same applies to sales to owners and partners in businesses with fewer than 10 owners or partners. Withdrawals and purchases must be specified per owner or partner or under your own business in an ordered sequence with a documentation date and documentation references. Withdrawals must be specified at fair value.

Sales must be documented in accordance with the general rules for required information on sales documents. In the case of withdrawals, these rules must be applied insofar as they are applicable.

Documentation of time spent

Those who are required to keep accounts, and who provide services where the price is based on time spent, must document hours spent for each owner and employee. You must specify the hours per day, broken down between internal time and time spent on individual customers/assignments. The provisions also apply in cases where a fixed price is agreed, but not to owners and employees who only perform internal administrative tasks. The documentation must be retained for at least three years and six months after the end of the financial year.

Salary documentation

Documentation of salary payments must be prepared for each individual employee. For employees who are paid an hourly wage, in part or in full, the following information must be documented:

  • date on which the work was performed
  • number of hours for the relevant date
  • total hours for the period concerned

In Norway, this documentation must be retained for at least three years and six months after the end of the financial year.

Appointments

Those who are required to keep accounts, and who provide services by appointment, must document their appointments by specifying when the service was provided and the name of the customer. The documentation must specify which appointments that were not conducted. If a cancelled appointment is replaced by a new appointment, this must be documented. The documentation must be retained for five years.

Contracts

Systems for contracts and ordering may be necessary if you have individual deliveries. Both sales and significant purchases should be registered in such a system. If you buy and sell expensive consumables, orders and contracts concerning deliveries should be registered as soon as the order is placed. Such a system may include:

  • Contract date
  • The parties to the contract
  • What is to be delivered (nature and quantity)
  • Agreed price
  • Date of delivery
  • Reference to documentation

If you prepare written contracts with customers, these can be stored alphabetically under customer name. You'll then have a register of contracts and will not need to make any further records.

Project accounts

If you carry out assignments in the construction and engineering industry with a value of more NOK 300,000, you must keep project accounts. Project accounts are a list of incomes and costs per assignment. You can ask your accountant to prepare these accounts. However, your accountant will need you to provide an overview of the projects you are working on at any one time, and to specify which projects your vouchers concern.

Payment of bills

Systems for paying bills are important for maintaining an overview of the bills that must be paid at any one time.

Credit sales

A system for following up credit sales is important to ensure that you collect the money you are entitled to as quickly as possible.

Stock keeping systems

A stock keeping system is required for production companies that process/refine goods and some businesses that sell products that are subject to excise duties. Such systems are also useful for other commercial firms as they provide an overview of how far in the production process goods have come. They can include the following information:

  • Acquisitions, disposals and stocks of finished goods, any raw materials and semi-finished goods
  • Nature of the goods
  • Quantity (with a clearly specified measuring unit)
  • Value of each item

It must be possible to specify stocks per product group. It must also be possible to distinguish VAT exempt goods and present them as a separate group. Obsolete goods must be presented as a separate group.

Inventory

Inventory must be prepared annually. Stocks of goods must be counted and grouped. Inventory must contain the following information:

  • Nature of the goods
  • Quantity (with a clear statement of measuring unit)

It can often be difficult to remember what was done or agreed a while back. You'll save yourself a lot of work in the future if you keep your accounts and office work up-to-date. The Bookkeeping Act also imposes specific requirements concerning updating.

  • Make sure you set aside time for daily office work. It may be appropriate to register contracts and time records on an ongoing basis during the working day. Cash sales must be recorded on an ongoing basis.
  • Agree with your accountant how often the accounts will be updated and when vouchers are to be submitted. You should normally update your accounts at least every other month.

In the list below, you can insert a tick to indicate the tasks and tips that are relevant to you. It can be a good idea to contact your accountant or auditor to discuss your office routines.

You can also contact the Norwegian Tax Administration, Norges Autoriserte Regnskapsførere (Norwegian Association of Authorized Accountants) or Økonomiforbundet.

Insert a tick next to the tasks/tips which you think are relevant to you

Statutory* 

Carried out

Set up a separate bank account for the business

 

Upon start-up

Place all vouchers in a folder, sorted

 

Ongoing

Withdraw money for private use in larger amounts

 

1-2 times per month

Pay bills

 

Weekly

Follow-up of customers who have not paid

 

Weekly

Print invoices 

X

Daily/Weekly

Make sure that the expense voucher is fully completed

X

Ongoing

Prepare vouchers for your own withdrawals/deposits in the business

X

Ongoing

Set up two petty cash boxes. A “sales petty cash box” and a “fixed petty cash box”

 

Upon start-up

Use the cash register to register cash sales

X

Ongoing

Count up the cash in the cash register(s)

X

Daily

Reconcile cash against sales according to the cash register

X

Daily

Record all incoming and outgoing cash payments in a system

X

Daily

Deposit money from cash sales in the bank

 

Daily

Record goods withdrawals and/or sales to owners/partners

X

Ongoing

Record appointments

X

Ongoing

Record incoming assignments

 

Ongoing

Record hours spent on assignments

X

Ongoing

Register contracts and orders

 

Ongoing

Mark vouchers with the project they concern

X

Ongoing

Count stocks and prepare inventory

X

Annually

 

* Some of the statutory requirements do not apply to all businesses or in all contexts. This must be clarified with your accountant/auditor or the Norwegian Tax Administration. You can also look up the Bookkeeping Act and the Bookkeeping Regulation.

Everyone who is required to submit income statements under the Tax Assessment Act or turnover statements under the VAT Act is required to keep accounts under the Bookkeeping Act. Some businesses are also required to prepare annual accounts based on the provisions of the Accounting Act. This concerns for example:

  • All private and public limited companies
  • Shared liability partnerships and limited partnerships. With the exception of those whose sales revenues amount to less than NOK 5 million and who have fewer than five employees. An additional requirement is that there are no more than five partners.
  • Sole proprietorships with total assets with a value exceeding NOK 20 million or more than 20 employees.

Businesses that are obliged to prepare annual accounts are also obliged to appoint an auditor. However, exceptions apply for companies and sole proprietorships with operating revenues of less than NOK 5 million and fewer than five partners. Private limited companies may choose not to appoint an auditor if operating revenues are less than NOK 6 million, the balance is less than NOK 23 million, and there are no more than 10 full-time equivalents.

If you want to know more, you can contact your local tax office.

Regnskap Norge
Phone number: +47 23 35 69 00

Økonomiforbundet
Phone number: +47 62 53 65 10

Brønnøysund Register Centre
Phone number: +47 75 00 75 00

Lovdata