Some entrepreneurs don’t particularly enjoy accounting or bookkeeping by spending time adding up receipts or pushing invoices in a desk. But it's your job to know where your money is going and if it's being managed correctly. Here are some simple tips to know the accounting side of your business, even if you’re not a math person.
Review daily records.
It’s very important to review your daily records regularly. The regular and accurate review will let you know how your business is going and will allow you to control your cash flow.
Keep your business and personal finances separate.
It’s important to keep your personal finances separately from your business finances. It will make your account more difficult to handle. Get a credit card for business use only. Separate credit cards will make it easier to keep accurate records, so stay organised.
Keep your financial records.
o Invoice or receipt for everything you buy
o Sales invoice file (sales or services by your business)
o Purchase invoice file (goods, services or other business acquisitions you purchased)
o Records of payments made to employees plus other organisations on their behalf
o All your financial statements including profits, loss statements, and balance sheets
o Tax Return
o Bank accounts and credit card statements
o Stocks records at the end of financial year and asset register etc.
o Anything else with a monetary value to the business
Get the right accounting software that suits your business needs.
If you’re not sure which software to select, you can contact a business consultant or accountant that can advise you before you buy. Cloud software is an example, which can help you access your finances anywhere, anytime or have a bookkeeper or accountant to check information for you.
Plan for major expenses.
Set aside money for expenses like inventory, office supplies, repairs, maintenance and the computer upgrade. Acknowledge the seasonal ups and downs -- something that many entrepreneurs are hesitant to do). But by budgeting for your small business in the years to come, you can save a lot of worry about dealing with these expenses in the future.
Avoid cash.
By using cash, it will be hard to track your spending, and you may also lose track easily of write-offs because there’s no record of purchases. But by using a debit or credit card, you can keep track of the amount you’ve spent.
Grow your business today with the help of Total Care Accounting Solutions.