As a business owner, one of the duties you have is making sure that the day-to-day operation of your business is in the hands of the most capable individuals that you can have around you. Whether it is waste disposal, technology, or the company's accounting system setup, the right people make for a smoothly run business.
The tricky aspect of running a business in this fashion is that sometimes the overall size of the company may mean that you, as a business owner, represent nearly the entirety of these departments, with few being as important as your accounting system. After all, a company that cannot regulate its finances is in quite the predicament. You may mean well, but you may lack the right background, training, and tools to make sure things are done right.
To this end, setting up your own accounting system doesn't have to complicated. You just need to make it a priority in your overall business plan. Consider the following tips:
1. Keep It Simple - Early on, you just need a simple way of keeping track of your company's expenses. As time goes on and your need increases, you still have access to low-cost systems that are user-friendly & allow companies to maintain a lot of control on the accounting front. Either way, though it can't be stressed enough how important having an accounting system in place is, don't overwhelm yourself this early in the process.
2. Business and Personal Expenses Should be Separated - If you're an entrepreneur who is just starting his/her own business, this would seem like Business Practices 101, but many business owners still blur the very fine line of what money goes where only because as your business gets off the ground, you are funding your business with your own money.
3. Keep Track of What You Buy - As you begin to establish your company's accounting system, you will be responsible for maintaining a paper-trail for your expenses. Some companies are able to maintain very accurate records with physical receipts while others have found success with virtual storage.
4. Set-up Payroll - This may vary based on whether your business actually has employees from the start. After all, if you're starting a business, you may be the only employee for a bit. Either way, as your needs change, a payroll provider will be key to ensure everyone is paid correctly and that any additional issues such as payroll taxes are addressed.
5. Hire Professional Help - This point cannot be stressed enough. Part of the reason we indicated that simplicity was key for first-time business owners when it came to keeping track of finances is because we are indirectly acknowledging that they don't have experience in the field of accounting. There is no shame in asking for help, and reaching out to a local, trustworthy financial firm or CPA office may be the best investment in your business you can make.
An accounting system setup for your business is essential to its financial health and longevity. Whether you decide to run things yourself in a simple & straightforward manner or welcome professional help in lieu of your inexperience, you are laying down the groundwork for responsible business practices.
Is your business looking for a reliable accounting firm? Feel free to call Daniel and his team DJK Partners today!