It is not until trouble occurs do small businesses realise the importance of bookkeeping – a mundane, time-consuming business activity. In this post, we share some of the must-do bookkeeping practices that can contribute to your business’ growth. Bear them in mind as you deal with this ‘burden’. Rest assured they will not take you away from other important business activities, for example, marketing, sales or managing customers.
- Record keeping
Your book is a measure of the business’s financial well-being. It’s the first point of reference in determining if the business is fine or not. The book’s well-being is achieved by ensuring proper and accurate accounting records, not bookkeeping or accounting trickery. With cloud-based accounting systems, this task has been made much easier. - Set up internal controls
It is quite common for small businesses not to establish internal controls. Interestingly, some see it as too big an activity for a small business. When it comes to establishing financial controls, no business is too small to have it. It is a bookkeeping practice that should be implemented from the word “go!”. It will save you heaps as you grow the business. - Leverage on accounting technology
The days of the shoebox bookkeeper are over. Cloud-based bookkeeping and accounting systems are easy to use and affordable too. Online bookkeeping is an increasingly common practice today. From anywhere, anytime, you can keep a close watch on your small business’s financial well-being. There are various add-ons you can consider that parallels the stage of your business’ growth. - Separate business and personal finances
It’s a common mistake of small businesses, that is, treating business and personal finances similarly. Failing to separate them is a recipe for disaster. Treat them as different entities. When you do, it’s easier to check on the progress of the business. It’s a discipline that must be inculcated at the start. As part of this discipline, it is best to outsource your bookkeeping functions.
Bookkeeping can be an ‘inconvenience’. But it is a vital business function. Make it work for your business. Connect here to learn more.