No matter what size your business is, bookkeeping is an essential part of keeping things running smoothly. While good bookkeeping practices can help you meet your financial objectives, poorly tracked finances can cause you serious issues. Avoid the common mistakes and consider the following top habits for good bookkeeping.
Top Habits for Good Bookkeeping
Running a business is not easy and can be even more difficult with an unsteady economic climate. Consider the following top habits for good bookkeeping so you can meet your financial business goals this year.
Set Yourself Reminders:
Any financial-related deadline should be on your calendar with a reminder. This can help you avoid so many issues despite how simple it is. Payments for your regular bills, payroll, and payroll taxes can keep you on track. It’s helpful for your peace of mind as well as you know you have a reminder set versus having to remember everything off of the top of your head. Avoiding late fees is a major benefit as it is unnecessary and can add up quickly.
Keep Receipts and Invoices in Numerical Order:
Organizing as you go is much more effective than shuffling through documents or files when you are looking for something. Recording your receipts and involves in numerical order can help you maintain an organized audit trail. This ensures that no gaps are left unreported and it is much easier to check what has cleared and what hasn’t.
Maintain Organized and Consistent Records:
While this is a huge favor to your accountant, it can also be helpful for you. Organized and consistent records can prepare you for an audit and help you keep close track of your financials. Use the same system throughout the year and only make changes at the beginning of the year. This will help everyone involved as adjusting your system in the middle of the year can cause a number of problems that can cost you time and money.
Keep Records of Your Transactions:
Paid bills, deposit slips, receipts and invoices should be maintained. If you have the paper copy, digitize it for your electronic records. Talk with your accountant about recordkeeping best practices so you know how long to keep what documents. Some you may be able to shred or delete annually, while others may need to be retained for years. Maintaining these records can also help when working with vendors as you can negotiate based on prior prices.
Keep Daily Records:
Take a few minutes each day to update your records and organize any financial files. This can help save you so much time as compared to letting it pile up for weeks or months. Your accountant will thank you later as it can help them provide you with more effective reports and financial statements. Talk with your accountant about what needs to be done on a daily basis to ensure you can meet your financial goals. If you don’t already have an accountant, Indevia Accounting have some of the top professionals in the business available to assist you. This can help you achieve your business goals much faster and take a lot off of your workload.
Delegate Tax Return Preparation:
Even the most ambitious business owners delegate tax return preparation. Outsourcing this can take a huge burden off of you. It is also important to have a professional who is skilled in tax preparation complete your returns as they understand the complexities of the tax system. Doing it on your own can take time away from crucial business tasks and waste vital resources unnecessarily.
Secure Storage for Records:
Businesses have a massive number of important documents. You should have a safe, secure location for all of your physical documents. Additionally, keeping your electronic records secure is just as important. Talk with your accountant about their recommendations to ensure that your records are safe.
Outsourcing accounting duties does not mean that you should leave it entirely in the hands of someone else. You should review the financial reports to understand your business financials and ask questions if clarification is needed. Selecting a skilled accounting firm can help take the burden off you without feeling uninformed. Understanding your finances is the most important aspect of running your business, as it can help you meet your business goals.
Bookkeeping is integral to the success of your business no matter what size. Hiring a professional accountant can ensure your financials are in good hands. Indevia Accounting offers a wide variety of services for businesses of all sizes. Their services are meant to meet your unique business needs so you can focus on the day-to-day aspects of running your business. Contact us today to learn more!