Excel Bookkeeping Templates

While accounting software has significantly helped businesses manage bookkeeping tasks, not every business can afford the subscriptions, let alone the cost of training and retaining a bookkeeper to enter and maintain data in the software. 

However, businesses can bridge this gap with simpler and more affordable Excel bookkeeping templates.

In this article, we will help you identify whether spreadsheets are an ideal choice for you. We will also take you through the benefits of using Excel spreadsheets for your bookkeeping needs and provide free templates for the major business accounting processes. 

Who Should (and Shouldn’t) Use Excel to Track Their Books

If you’re a small business owner looking to streamline your financial tracking process (or that of your client), you may consider both Excel and QuickBooks options. 

While Excel templates are a great choice for those on a tight budget, paid accounting software like QuickBooks offers more advanced features and integrations that may better suit the needs of some businesses.

When choosing between the two, compare the benefits and limitations of each tool to help you decide which option is right for your unique financial needs.

Pros/Cons of Using Excel for Bookkeeping

Excel is a spreadsheet software widely used by many businesses for bookkeeping purposes. Though it has advantages, such as familiarity and flexibility, it also has potential drawbacks. Some advantages of Excel include the following:

  • There are free and readily available templates.
  • Even if you were to buy a more customized template that meets your specific needs, it would still be more affordable than a paid accounting software subscription.
  • Excel is easier and faster to learn and use.
  • If you are an Excel guru or can buy a more customized template, you can reduce some of the manual work and calculations by using dynamic formulas across the entire template.
  • It offers a data analytics feature using charts and graphs.

However, it’s not always a smooth process with Excel templates. There are several disadvantages to using spreadsheets for your bookkeeping:

  • Excel requires a lot of manual work to enter accounting data. For businesses using the accrual method of accounting, it means double the work, entering data twice for every transaction. This extra effort wastes time and money that could go into other aspects of the business. 
  • Although Excel may initially seem easy, using formulas and dynamic sheets has a steep learning curve.
  • Even the most repetitive tasks, already automated with accounting software, have to be manually entered on spreadsheets. For example, most accounting software allows businesses to integrate their system with other systems like invoicing apps, inventory management, and bank accounts and credit cards.
  • A single formula deletion or mistake can lead to numerous errors and inaccurate data for the end user. For instance, if the Excel workbook is dynamic and the formulas are linked, one mistake will affect the entire template leading to broken formulas. Entering the wrong date will affect the whole worksheet, producing incorrect information. 
  • There is an opportunity for fraud due to the ability of individuals to input bad data without any trackability and enforced compliance with accounting standards.
  • Excel makes it difficult for your accounting transactions to scale with your business. Keeping up with growth metrics like increased prices, rolling out new products or services, or financing can be incredibly challenging with Excel. 

Pros/Cons of Using Bookkeeping Software

Bookkeeping software has become increasingly popular among businesses of all sizes. It provides many benefits, including improved accuracy and efficiency in financial record keeping. However, there are also potential drawbacks to consider when choosing bookkeeping software.

Some advantages of using software for bookkeeping include the following:

  • Reduces manual tasks, such as uploading bank transactions, sending invoices, and reconciling ledgers.
  • Customizable templates help your business look professional.
  • Run financial reports and data analytics easily. Once you have the correct entered data, you can generate and download key financial reports like cash flow and profit and loss statements with year-to-year comparisons for data analysis.
  • Run payroll.
  • Track, reconcile, and manage inventory.
  • Increase accountability and compliance with accounting standards.
  • Allows for collaboration among teams, with the ability to set permissions for every user.
  • It has app access for use on the go, with many providers allowing you to capture photos of expense receipts through the phone.

The drawbacks to bookkeeping software include the following:

  • It’s costlier than free spreadsheet templates. Additionally, software packages with more features, like multi-currency and multiple users, are pricier than packages with basic features.
  • The implementation can be challenging and require a professional’s help to ensure you comply with the necessary tax regimes and accounting standards.
  • Data and service loss risk increases due to reliance on computers. In addition, you could lose all the essential information about your business, if you neglect to backup your data. 

Free Excel Bookkeeping Templates

Here are some easy-to-follow templates you can download, which many DIY bookkeepers can use. We’ve also included some additional popular bookkeeping templates, if needed.

Income Statement Template

An income statement, or profit and loss (P&L), is one of three integral financial reports, along with the cash flow report and the balance sheet. The P&L summarizes the income and expenses of a business, with the bottom line showing the business’s net income or loss for the period.

Cash Flow Template

The cash flow statement shows the inflow and outflow of money within a business, usually broken into operating, investing, and financing activities. It’s usually a true measure of how a business manages its cash flows.  

Balance Sheet Template

A balance sheet, or a statement of financial position, is the third essential report of core financial statements. 

This sheet shows the company’s financial position or net worth based on what it owns (assets) vs. what it owes (liabilities and owner’s equity) during any given period. The balances on the assets side must always be equal to those on the liability and owner’s equity side. 

Chart of Accounts Template

A chart of accounts template is a pre-designed framework outlining the categories and subcategories for financial transactions in a business. 

It serves as a roadmap for organizing and recording all financial data, such as income, expenses, assets, and liabilities. The template typically includes numerical codes assigned to each account to ensure consistency in record-keeping.

Accounts Payable Template

The accounts payable account shows the money a business owes to its vendors. It represents goods or services delivered for the business, but the supplier still needs to be paid. The bottom line in the ledger appears in the balance sheet as a current liability.

Accounts Receivable Template

Depending on the company’s agreement, customers can make purchases and defer payment for goods or services. 

Since money from the sale has not been received, your business records it as a receivable, meaning it’s money to be collected. The balance in the accounts receivable ledger at the end of any period appears in the balance sheet as a current asset.

Sales Invoice Template

Invoices are legal documents that bind parties. An invoice contains details of the service rendered or product sold, including the transaction date, quantity, amount, tax, payment terms, and other relevant information. A sales invoice facilitates the payment of services offered or products sold.

Bank Reconciliation Template

Bank reconciliation in bookkeeping refers to reconciling the balances between a company’s bank account statement and the bank account ledger. While the closing balances should be equal, sometimes there are variances. 

The items causing these variances are known as reconciling items. These items are added back or subtracted from the closing balance for the period in the bank statement during the reconciliation process. The process allows you to identify and resolve issues quickly and reduce the chance of fraudulent activities. 

BONUS: A Free Bookkeeping Workflow Template

A bookkeeping workflow template is a pre-set plan for managing financial transactions in a business. It helps you keep track of important deadlines and a list of all tasks needing completion to maintain accurate records. This template saves time and money, ensures compliance with accounting standards, and keeps businesses organized.

Are you looking for more accounting workflow templates to streamline your bookkeeping process? Check out Jetpack Workflow’s 32 free accounting workflow templates and checklists here. Download it now to save time, stay organized, and ensure compliance with industry standards. 

See Jetpack Worflow In Action

Get under the hood of Jetpack Workflow’s accounting workflow and project management platform. See some of the top features and how it helps your firm standardize, automate, and track client work more efficiently.