Monday, 15 June 2015

Top 7 Bookkeeping Tips for Small Business Owners

No business owner likes to spend time on Record keeping (also known as bookkeeping) . It is not considered a favorite task by most business owners. We already now that how important is bookkeeping for business. It is a vital element for running  good business.  Bookkeeping is no more done manually, you just have to choose a computer based accounting software for record keeping and follow disciplined approach toward bookkeeping.

It is essential for every business from brick and mortar shop to large corporation, big eCommerce sites to keep records up to date by law.

Here are 7 simple bookkeeping tips for small business owners to make bookkeeping easier and less stressful:

1. Allocate time to your books
To be on top of your business. It is very important to do regular review of your finances. This will let you know how your business is going, motivate you to make more sales and allow you to control your cash flow.

2. Go Paperless and use computer based accounting
First thing first, Back up all of your financial documents, preferably in tangible, paper form as well as electronically, in case of eventuality you can access them. Choose for  desktop based accounting platform with cloud support. Cloud based support helps you and your bookkeeper to access books anywhere, anytime.

3. Open a new business bank account for business earnings and expenses.
Never mix your business and personal  finances. It is important to keep your personal transactions separate from your business transactions. With separate business account, it is lot easy to keep accurate records and stay organized.

4. Keep your receipts
The records you are required to keep and have accessible upon request are:

  • Invoices and receipts you provide for sales or services rendered by your business.
  • Bills for goods, services or other business acquisitions purchased for your business.
  • Payroll Records  regarding employees
  • Bank accounts and credit card statements
  • Year end of financial  and asset register etc.
  • All financial statements including profit and loss statement and balance sheet.
  • Tax Return information.
  • Anything else with a monetary value to the business

Keep digital files on your computer to store this information or keep a well organized filing cabinet.

5. Reconcile Bank Accounts Periodically
To control your finance the first step is reconcile bank accounts at least once a month to spot and fix discrepancies more easily.

6. Check Up Monthly On Your Accounts Receivable.
This is little advance bookkeeping procedure of making sure that a client paid you money for services or products, especially at the end of the year. It is like, isn’t the same as having that money in your business account. Accounts receivable management ensure that your accounts receivable  team is  getting all the monthly payments you are owed. Regularly running an accounts receivable report will help you have funds in your bank account to make payments to vendors, employees and keep the business running.

7. Or, get a great bookkeeper
Hiring a bookkeeper help you focus on growing your business needs and have record keeping is up to date.
I, Paula Barbuda, associated with Max Data PRO an offshore bookkeeping service company based in India since 2006. Your can reach me by filling the form posted in the footer of this web page.