Book keeping is an essential part of running a successful business. Successful business owners have adopted a few basic procedures to stay on top of the paperwork.
Have a vision and plan for where you want the business to be in the long run. Plan for major expenses in advance. Almost all businesses have a set of supplementary or ancillary costs that often go unnoticed and do not always make it to the budget. For instance, every time a new software or equipment is purchased, although the cost of equipment might figure in the purchase, associated costs such as training, time and maintenance costs involved in the process might have been missed, thus resulting in an underestimation of the actual costs involved.
Some software products import directly into accounting software such as QuickBooks. Utilizing this type of tool will help save time and paper, and help audit-proof bookkeeping records. While transferring data from paper to computer, one can run a dual system for a few months, and when both the systems have the same totals, the paper trail can be dropped.
Create a checklist of all required statutory reports including due dates, type of tax, report, period covered, etc. Put aside a portion of money throughout the year for taxes, note tax deadlines on the calendar, along with prep time, to make sure payments are actually made when they are due.
Request for statements with a month-end cut-off date, and save time when reconciling records with the bank statement every month. Do not file statements and canceled checks without reviewing them and review statements immediately for unauthorized checks. Maintain separate folders every year for paid invoices and bills, and go for numbering of the folders for all clients for ease of use and reference.
Save storage space and opt to go paperless with the purchase of a good scanner. A good scanner costs only around $500 to $600 and is a very affordable solution.
Consistency is the essence of successful business bookkeeping. For most small businesses, the most common bookkeeping errors are also the easiest to fix. Getting a better handle on bookkeeping can help make and keep long-term goals, smooth out the seasonal ups and downs of cash flow and improve business profits.