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The Simple Methods Accountants Use to Spot Balance Sheet Errors Sooner

Written by Paul Murray | Jan 16, 2026 4:15:59 AM

 

Balance sheet issues rarely start as major problems. They usually begin with small posting mistakes, incorrect coding or entries left sitting in clearing accounts. Over time these small items become harder to trace and end up slowing down month end and year end work. 

The accounts most likely to hide errors are the ones reviewed least. Suspense, disbursements, wages payable, super payable and other clearing accounts do not have automated matching, and without regular checks they quietly accumulate transactions that never align. 

Firms that stay ahead of these issues rely on consistent review habits and clear visibility. When information is easy to access, errors are spotted earlier. 

A platform like AccountKit supports this by keeping client information, workflows and notes in one place, which helps teams review non bank accounts more effectively. 

Below is a practical guide to help your team spot issues earlier, backed by examples accountants face every day.

Why balance sheet errors hide in non bank accounts

Non bank accounts depend entirely on human review. When workloads increase, these accounts tend to be checked last. That is how small problems compound. Common examples include:

  • GST applied where it should not be
  • Duplicated entries that sit unnoticed
  • Timing differences that never get cleared
  • Payroll entries that drift over time

Without context, these items blend into general account activity.

A simple example:
A client reimburses a business for expenses. One part is accidentally posted with GST and the other without. Both entries look reasonable on their own, so the issue goes unnoticed. When it is picked up later, often at year end, the reviewer has to dig through emails, receipts, and job notes to understand what went wrong and manually correct it.

When your team keeps notes, documents and workflow steps in a central system like AccountKit, it becomes much easier to understand what happened and why an entry looks the way it does.

The hidden cost of detecting errors too late

When errors stay hidden, the clean up is always more painful. Late detection often means:

  • reviewing several months of activity
  • correcting balances from earlier periods, which may result in GST adjustments
  • explaining unexpected adjustments to clients
  • reworking workpapers that were already considered complete

A single error can affect multiple months. For example, a wages payable account that carries forward a small incorrect balance can mean hours of digging whilst trying to prepare the STP reports at year-end. If the discrepancy is caught in the same month, the fix is quick. If it is caught at year's end, the team has to unravel what has happened and potentially adjust multiple months of work

Monthly reviews prevent this. Firms using structured workflows in AccountKit often find it easier to stay on top of these tasks because review steps are already built into their recurring processes.

What an effective account review process looks like

A strong review routine is predictable and consistent. The best firms share these habits.

Clear visibility
You should see instantly what has been resolved and what needs attention. AccountKit’s practice wide views help keep this clear.

Awareness of patterns
Balance sheet accounts should move in a way that makes sense. If wages payable suddenly spikes or super payable barely changes, something is off. Month to month comparisons make these anomalies obvious.

Fast mismatch detection
Incorrect GST or coding prevents entries from offsetting. These mismatches are easier to spot and correct when reviewed regularly.

Defined escalation
Preparers should know when to ask for help. Commenting and task assignment tools create a clean handover for seniors.

Useful notes
A short explanation left at the time of the review is far more helpful than trying to recall details months later. Keeping these notes attached to the client or task avoids information scattered across emails or spreadsheets.

These habits help teams catch issues early, long before they turn into delays.

How AccountKit supports early error detection

Healthy review habits are the foundation of accurate balance sheet work, but the systems behind those habits often determine how smoothly reviews run. Many firms use AccountKit to support early error detection because it keeps the information needed for a good review together in one place.

Here’s how it helps:

  • All review context sits together
    Notes, correspondence, documents and workflow steps appear alongside the client, making it easier to understand why a transaction looks the way it does.
  • Monthly review routines become easier to follow
    Recurring workflows allow firms to build their review steps directly into AccountKit, keeping monthly checks consistent across the team.
  • Managers gain visibility across all accounts and clients
    Practice wide views help managers see outstanding items, review notes and progress without needing to chase updates.
  • Notes stay attached to the right place
    A short note left at the time of review gives future reviewers the context they need. AccountKit stores these notes where they belong.
  • Handovers are smoother
    Commenting and task assignment features support clean transitions between preparers and reviewers, helping teams resolve unclear items quickly.

This structure reinforces the core goal of early detection: clearer visibility, cleaner workflows and fewer surprises at year end.

Practical methods accountants use to catch errors early

Here are the steps many firms rely on to detect issues well before year end.

  1. Group entries to reveal mismatches

Filtering unreconciled or unusual entries often exposes issues straight away.

Example:
A super payable account shows multiple entries for one employee. One is coded differently. Grouping makes the discrepancy easy to spot and investigate.

  1. Review the full account history

Some items only make sense when you look beyond the current period. Tracing activity back a few months is sometimes the only way to confirm what should have happened.

Having documents, notes and correspondence linked to the client helps the reviewer understand the timeline quickly.

  1. Fix issues at the source

Updating entries directly in Xero ensures the ledger reflects the correct information. Once updated and refreshed, the account typically aligns without additional adjustments.

  1. Document unresolved items clearly

Not every issue can be solved in the first pass. Leaving a clear note prevents the next reviewer from repeating the same investigation.

  1. Make monthly review a non negotiable

Monthly checks prevent small anomalies from growing into year end problems. They also make it easier to spot changes in patterns or recurring issues.

Monthly balance sheet review checklist for accounting teams

Use this list each month to keep accounts accurate and manageable:

  • Review key balance sheet accounts every month
  • Check GST coding accuracy
  • Investigate unexpected movements
  • Flag items older than 30, 60 or 90 days
  • Review inter entity and related party activity
  • Compare actual movement to expected movement

Many firms add this checklist directly to their AccountKit workflows so the whole team follows the same routine.

How to build these review methods into your month end workflow

A clear month end structure reduces rework and speeds up reviews.

Preparers complete the first pass
They resolve simple issues and document anything unclear.

Seniors complete the second pass
They focus on complex items and confirm the account is accurate.

Managers maintain oversight
Using a centralised workflow tool like AccountKit gives managers visibility across all clients and review stages without needing to chase updates.

Everything stays connected
Client details, correspondence, supporting documents and workflow steps remain linked. This keeps the review process smooth and avoids time wasted searching for information.

A clearer path to cleaner balance sheets

Finding balance sheet errors sooner comes down to two things: visibility and consistency. When your team has structured review habits and all the supporting information in one organised place, errors are easier to identify and quicker to resolve.

AccountKit helps firms work this way by connecting workflows, notes and client information, giving teams the clarity they need to keep accounts clean throughout the year