Apart from monitoring and planning your small business’s financial strategy, entpreneurs and those new to money management from a business’s perspective commonly struggle with bookkeeping. In many ways, financial strategy and effective planning really can’t begin without consistent and accurate bookkeeping in the first place.
For this reason, we’ve decided to put together a brief list you can use as a reference when devising your preferred method for keeping track of your finances day-to-day, month-to-month, and so on. Not only is this important for simply knowing where your business stands financially at an given time, but it also help alleviate the stress and hopefully shorten the time commitment you’ll put in when tax season rolls around.
If you tend to brush off bookkeeping as a nagging chore, you might want to take another look at the benefits of keeping your books in order. Capturing your all of your expenses when they happen is an important element to maintaining and monitoring cash flow. If your business receives write-offs, keeping a close eye on your records will ensure you don’t end up paying for things you don’t need to. More generally, keeping your finances organized and fully accounted for means less stress and frustration when issues arise and you need to call on your records.
1. Learn the ins and outs of the process before jumping in
Small business owners tend to have a wide variety of excuses for poor record keeping. While some simply don’t see the value to in the time and energy commitment, others consider it too overwhelming to even know where to start. No matter why you’re not being as complete as you should be, it’s important to understand how to get yourself in a position to manage that part of your business.
There are a number of online courses that teach specifically these kinds of skills to entrepreneurs looking for a crash course in introductory bookkeeping. Whether you’re looking for a more generalized bookkeeping instruction, or want to learn the ins and outs of a particular bookkeeping tool, these kinds classes can equip you with the means to be efficient with your records.
2. Pick the right software tool
If you’re reading up on bookkeeping before you’ve launched your business, one of your main focuses in the planning stage should be choosing a software platform to keep your records logged and maintained on. QuickBooks has become something of an industry standard in recent years and if you don’t know where to start looking, it’s a great tool to look into. That said, there are plenty of Cool Tools out there worth exploring.
3. Work on organization
Every business operates on a different workflow, so simply duplicating a partner company’s bookkeeping method more than likely will fall short of achieving actual effective record keeping. Start ironing out your workflow and what kind of bookkeeping plan will best align with your cash flow situation. It may be useful to keep both physical and digital folder systems to collect receipts, invoices and other financial documents you can store to ensure you’re accounting for all finances flowing in and out of your business.
4. Outsource to financial professionals if your budget allows
If you find yourself out of options when it comes to keeping your bookkeeping duties in-house, bookkeepers, accounting firms and other financial professions are always a viable to option for those who want to ensure their records are kept and also have the means to hire outside services.
A major advantage to working with financial professionals besides the lightened workload, is the benefit of having accountant services available to answer questions and offer advice about what steps to take to protect your finances. This is also a great option for those who are capable of handling day-to-day bookkeeping tasks but need assistance setting up software or installing a system you can use regularly.
If you’re a start-up owner and unsure of how to establish a bookkeeping system, give us a call. Our outsourced accounting and CFO services experts can help you navigate these waters.