Maybe you just started a business, or perhaps you are already an established business looking to get a better handle on your finances. Regardless of the position you are in, we have some great accounting tips for entrepreneurs looking to improve their record-keeping. Managing money can be a complex problem. Understanding how to account for your money will make you and your business more successful for the long haul and could make you the featured small business of the month.
1. Understanding the Basics
When you are an entrepreneur, it is always worth learning a little about all aspects of your business. This is required in the early stages of growth. With accounting, you need to understand the basics of record keeping, tax laws, and money management. Find a piece of software you can learn and use as you grow. The internet is full of useful information; finding detailed documentation about the basics of accounting will help you understand this quicker.
2. Keep It Simple
Always keep your books as simple as possible. This will allow you to access the information you need at any time without delay. You may also want to consider keeping separate books – one for expenses, one for income, another for debt, one for the mortgage and the like. When you know what is contained in each book, you can quickly gather the necessary information later.
3. Keep an Expense Card
Random expenses pop up all the time; it’s part of the cost of doing business. Networks crash, vehicles break down, computers freeze, and you may need to hire a specialist from time to time to fix these problems. Allocating budget each month to unexpected expenses is a great way to be proactive about the potential of these things happening.
4. Check Your Books Monthly
You need to monitor your books monthly. Knowing exactly what comes in and what goes out regularly is how you avoid overdraft fees and bounced checks. Depending on the nature of your business and the transactions you make every day, you may need to review your books weekly, monthly or quarterly. When you know what is happening on the financial front, you know where your business is going, so it’s essential to check your books and other financial statements periodically.
5. Hire a Professional Accountant
If you think your company’s accounting needs are time-consuming, it’s a good idea to hire a small-business CPA from a reputable company. Accountants can simplify your tasks and reduce your bookkeeping worries. This is why it is essential to look for a reputable company that has a team of highly qualified professional accountants. Find a company and hire a professional who can fully service your accounts. Outsourcing payroll along with your accounting is also an option.
As your business grows, you will find that accounting and bookkeeping take a considerable amount of time. Although you can allocate this responsibility to one of your employees, it can still be a waste of time and resources. Therefore, it makes sense to transfer financial accounting to a specialist with several years of experience.