Small business owners attend to a lot of tasks in managing their companies’ daily operations. Hence, it becomes easy to forget one of the most integral parts of company management: bookkeeping.
Organized bookkeeping is a must in keeping a business afloat as well as helping the company reach its goals. That said, bookkeeping can be tricky for individuals and owners not used to it, whether it is about keeping records or setting up a reliable accounting system. To help you, here are some tips you could use to stay on top of your business’s finances.
Separate Business and Personal Finances
This is the golden rule of bookkeeping. To efficiently manage your business’s finances, you need to separate your personal transactions first. Several business owners start with using their personal accounts, but this will be troublesome later on as the number of transactions increases. It will only create more work and confusion for bookkeepers as they struggle to differentiate between company transactions and personal ones.
Some of the ways you can keep the company’s and your finances divided include:
By distinguishing personal and business transactions, you can make bookkeeping significantly easier.
Collect and Organize Finance Records
Bookkeeping is useless if it does not accurately record the finances of a company. Thus, make sure to always keep the receipts, invoices, and other financial documents in a transaction. Not only do you need these for bookkeeping, but they also serve as proof that the transaction happened in the first place.
For storage, you can choose between paper and electronic copies. If you opt for paper copies, make sure to store them in a locked safe and mark them properly with labels and binders. As for electronic records, make sure that you are using trustworthy online storage for safekeeping. Many companies use a mix of the two to help ensure a back-up, in case files are destroyed or misplaced.
Set Deadlines and Reminders
It is easy to lose sight of deadlines when you attend to multiple company matters throughout the day. By setting reminders, you can address upcoming deadlines. It is especially the case during tax season when you need to present financial reports to relevant authorities. That way, you can avoid penalties imposed by missed deadlines or delays.
Moreover, set aside time to go over the books and ensure that the numbers match. It will help you point out accounts that need settling, and you’ll have a better picture of how your enterprise is doing financially.
Use a Mix of Outsourcing and Assigning
With so many tasks to do each day, it is not uncommon for business owners to outsource payroll accounting. It will help ensure that tasks, such as issuing paychecks and filing payroll tax returns are accomplished on time. After all, there are professionals you can hire for a reasonable price.
That said, some bookkeeping to-dos are difficult to outsource. Issuing invoices to customers, depositing customer payments in the bank, and producing monthly financial statements are all tasks you would prefer to keep inside the company.
Hence, some business owners use a mix of the two approaches. They do some of the bookkeeping themselves—or assign an employee to do it—while outsourcing other tasks.
Install a Compatible Accounting Software
Accounting software can help you tremendously in managing your finances. You can use them to input data, automate some processes, and assist you in generating reports. However, an accounting system that works for another company will not necessarily work for yours.
To make the most of your investment, you must install software that meets the needs of your enterprise. This is easier said than done, so you need the skills and expertise of a pro who can guide you in the right direction. In that regard, ANSI is more than happy to help you.
ANSI is a Philippine-based systems provider who has served many businesses, both locally and internationally. With over 30 years of experience, ANSI has the skills and products that can help you address your accounting needs. For more information, contact ANSI today and learn more about how you can improve and streamline your company’s bookkeeping.