When an entrepreneur starts a business, they are likely not interested in the paperwork. However, it comes with the responsibility of owning a business.
It’s a necessary evil; being organized and taking care of the paperwork is the only solution. Efficient bookkeeping will help maintain a healthy cash flow, allowing you to identify trends and potential financial problems.
If you’re new to bookkeeping, here are some tips to get started:
1. Maintain financial records
While the exact documents will vary business to business, there are three categories of documents that are essential for bookkeeping.
Cash book: All the payment in and out of your bank account.
Sales invoice file: Keep a record of all invoices. Better yet, use software to issue invoice that will also record the details.
Purchase invoice file: Make note on invoices, indicating how and when you paid them. File them accordingly.
2. Get a receipt
Any business can be investigated for tax filing. It’s a good idea to log everything so you’d have nothing to worry about.
Keep a paper document for every transaction. If you’re making the purchase online, print the digital invoice for records. It will be easier to file them together rather than trying to locate individual invoices in years down the line.
3. Keep the accounts clean
Your business, no matter how small or family-owned, must keep finances separate. Your personal account should not mix with the one for your business.
As the owner of the business, you can’t make personal purchases from the company’s money. Of course, being self-employed you take drawings, but you must still have a separate personal account.
This will help keep the account clean, and business and personal finances separate.
4. Check bank statements
Bank statements useful—you can identify transaction issues, and clarify problems with your bank. Check monthly statements to ensure everything is on track.
This can help combat fraud risk, bank errors, and offer insights as to how your finances are being spent.
Successful businesses spend smartly, have better credit control, and keep check of every transaction.
5. Practice regular bookkeeping
It’s tempting to leave bookkeeping for the weekends. You want to focus on your business; the core services/products and how to expand it further. But leaving bookkeeping for another time won’t do.
For one, you risk forgetting details or logging receipts, etc. If you want to tackle this outside of working hours, do it in the mornings. Make it a habit of waking up an hour earlier and getting down to bookkeeping right away.
Outsourcing bookkeeping can help take relieve your troubles. Moreover, bookkeeping software such as QuickBooks can help. In fact, you can find professional bookkeeping services in Boca Raton, FL to assist your employees in learning the software and maintaining it as well.
For instance, A&B Accounting and Business Solutions offers QuickBooks, payroll and bookkeeping services in Boca Raton to help businesses stay at the top of their finances.
