To many people, bookkeeping is a pain and diverts time away from earning income for a business owner. If you leave it to fester, it can lead to incomplete records, incorrect financial accounts and increased accountancy fees. Keeping on top of your books can reap rewards with current and accurate financial records and lead to reduced accountant fees.
So how can you help your accountant with your bookkeeping?
Records and documents
- Keep good records and notes to refer back to.
- Keep on top of your bank statements – Check them regularly – Identify any abnormal transactions.
- Keep on top of direct debits – Are they still required? Are they the correct amounts?
- Keep a monthly folder of receipts, expenses, supplier invoices and client invoices.
- Avoid cash – Where possible, avoid cash as it is difficult to keep track of income and expenditure.
- If possible, use a cloud service such as Quickbooks or Xero to record your transactions.
- If you find a cloud solution costly, free versions such as Pandle or Quickfile can be explored.
- If avoiding cloud solutions completely, use a spreadsheet to record your transactions.
- Daily tasks may include banking and reviewing bank transactions
- Weekly tasks may include reconciling your bank account, reviewing outstanding debts and cashflow forecasts
- Monthly tasks may include client billing and checking your progress against your goals.
Dont miss deadlines
- Ensure you are prepared and ready to make your payroll, VAT or other submissions in good time.
- Ensure you pay anything due in good time – Delays will incur penalties and interest which will snowball.
Manage debts and cashflow
- Regularly review and chase outstanding customer debts
- Utilise a system such as Go Cardless to collect direct debits from customers electronically
- Undertake cashflow forecasts of expected income and expenditure
Use Cloud Accounting
There are many benefits of using a Cloud based accounting system. Such as you:
- Can automatically pull your bank statement entries for coding into your accounts
- Can have a realtime view of the business including cashflow, Profit & Loss and Balance Sheet.
- Can automatically run VAT returns, payroll and financial statements.
Use add ons, apps and extensions for Cloud Accounting
There are also apps you can use to integrate into your accounting system such as
- Receipt Bank for expenses,
- ZohoCRM for Customer Relationship Management and
- Go Cardless for collecting customer direct debits
- Make a business plan – This will allow you to plan targets, goals and manage Key Performance Indicators (KPI’s)
- Make a budget – This will allow you to compare estimated income and expenditure against actual spend
- Make time to review your progress regularly – Either alone or with a mentor
Ascentant provide Accounting, Business consultancy and Bookkeeping services across Derby and Derbyshire. Contact firstname.lastname@example.org.