The good news for small business owners is that there is no set, legal way to do your books – they must simply reflect the business’s earnings and expenditure as accurately as possible. Most importantly, the way you run your finances must make sense to you. That said, the tips below will help you to manage your cash flow in a logical, effective manner – whatever type of business you’re running.
Begin your bookkeeping by creating a general ledger account – one of your company’s most basic, but important, financial statements.
A general ledger is one of the easiest accounts to create, and the one that most succinctly summarises the business’s income and expenses. Drawing up your ledger is fairly simple to do, particularly if you use accounting software. The ledger provides a record of your payments and receipts, and should be updated on a daily, weekly or monthly basis.
A big mistake that many new business owners and entrepreneurs make is mixing their personal and business cash. Even if you’re the sole owner of a company, it’s crucial to keep your finances separate by maintaining different accounts for personal and business money. This is also vital for tax purposes, and will help you to keep track of your expenses and budget easily and accurately.
Even if you intend to complete your accounts yourself, it’s worthwhile to speak to a qualified accountant, and to ask them to assist you in setting up your bookkeeping system. A professional will help you to understand accounting practices, making it easier for you to use software such as QuickBooks’ accounting packages. Moreover, he or she will show you how to do your tax reporting correctly, and will assist you when you need to prepare your income tax statements.
Never allow yourself to fall behind on your bookkeeping. It is absolutely essential to ensure that your finances are always up to date, so if necessary, set aside a specific time each day or week to attend to your books. Keeping accurate, up-to-date records will help you to recognise trends, potential weaknesses and growth opportunities. It will also ensure that you’re never without written proof in the event of monetary disputes.
Making use of an advanced accounting program such as QuickBooks’ accounting software takes the guesswork out of managing your finances – and also removes the incidence of human error.
Using this type of software saves time, increases accuracy and provides a paperless, highly effective means of maintaining your financial records. Each of QuickBooks’ accounting packages includes a demo to help you through the installation and use of the programme. Moreover, we offer telephonic and email support to all users of QuickBooks’ software, valid for 12 months from the day you register your software with us.
View QuickBooks’ 2008 range of accounting software now, or speak to our consultants today to discover which package would be ideal for your business’s bookkeeping requirements.