Accounting Tips for Small Business

Accounting can be tedious for any business, but if your small business doesn’t keep tight books it can make your taxes a nightmare. Without a system for your business’s finances a lot of things can slip through the cracks and end up costing you money in the long run. With a clear-cut process and some simple bookkeeping tips you can get a better grip on your financial situation, and even increase your earnings. The goal is to get a simplified process created detailing your businesses finances. Having a method that combines your expenses, invoices, deposit records and tax information can make your life as a small business owner ten times easier, especially as tax season rolls around.

1. Go Paperless by using Cloud-Based Accounting
Look for packages made for small business owners because they streamline the process by providing basic templates for your business like invoices, deposit slips, and business account check printing. With the addition of cloud-based accounting systems you can access your business information from anywhere.

2. Find A Good Advisor
Having a good advisor on payroll to help you out at least once a month can become invaluable. They can teach you how to handle your books properly, answer any questions and fix any mistakes that might have been made.

3. Keep Personal and Business finances separate
Never mix the two up, it will make your accounting much more difficult to handle. It’s a lot easier to keep accurate records if your only dealing with one type of account, so stay organized.

4. Plan for Major Expenses
Set aside money for major expenses like inventory, office supplies, repairs and maintenance.

5. Set Aside Money for Taxes
If you keep track of your financial records properly you can be prepared for year-end taxes. Setting aside a little bit of money each month towards paying your small businesses taxes you wont have to cutback at the end of the year or get a loan to pay your taxes, you will already be prepared.

6. Keep and Eye on Your Invoices
Late and unpaid bills can affect your businesses credit and effect your tax payments as well. Keep your bills organized and always pay on time.

7. Keep Daily Records and Reconcile bank accounts monthly
Double check your bank accounts and daily records at least once a month. Reconcile your withdrawals and deposits in your account so that discrepancies can be spotted more easily.

8. Avoid Cash
Using cash it is hard to keep track of spending. You also lose track easily of write-offs because there is no record of purchases. By using a debit or credit card you can keep track of amount spent, where it was spent and when it was spent.

9. Set up a specific time each week to go over your books
Giving yourself at least a half an hour ever week to go over your finances and make sure everything is in order.

10. Check Up Monthly On Your Accounts Receivable.
Having a client owe you money for services, especially at the end of the year, isn’t the same as having that money in your business account. Make sure you stay on top of your accounts receivable so that you are getting all the monthly payments you are owed. Without receivables, income dwindles.
Courtesy of Kabbage
For more information contact Neikirk, Mahoney and Smith at 502-896-2999