Simple Bookkeeping for Small Business in 5 Steps
Most small business owners don’t look forward to the inevitable task of bookkeeping. For many of these business owners, these tasks take a significant amount of time and effort to complete. And, worrying about the often tedious bookkeeping requirements can easily take a small business owner’s attention away from other important areas.
Ask yourself these questions:
- Does this process of stress and anxiety sound like your approach to bookkeeping?
- Do you always worry about finding time to focus on your books?
- Do you find yourself devoting more time and effort on your bookkeeping than you’d like?
If this is the case, there’s some good news ahead for you. You can actually save a significant amount of time with just a few minor adjustments to how you approach your bookkeeping.
Below, have a look at five easy-to-implement steps to improve your own bookkeeping process. These steps are aligned to the small business owner. And as you’ll see, each one can help you simplify your bookkeeping, save time, and put your mind at ease over this aspect of your business operations.
1. Designate a Specific Time for Bookkeeping Each Week
Many small business owners look at their bookkeeping tasks as something they can put off until “later” (whenever that is). It’s obvious that accurate and timely record keeping is paramount to ongoing business success. However, if you’re faced with customer relations and day-to-day tasks, it’s easy to neglect these concerns and put them on the back burner.
As you may have guessed, this type of approach does not work well over any extended period of time. Inevitably, you’ll have to take some time out of your day to focus on the books. Otherwise, you’ll find your small business in big trouble without the required bookkeeping tasks being completed.
Rather than continually put off and then stress over your books, one easy-to-implement strategy is to schedule specific time each week for these tasks. For example, you could schedule the first half of Monday morning every week to focus on your bookkeeping tasks. By specifying a time each week, you’ll always know when you should complete these tasks. And, this will help you maintain a high level of consistency in your records without worrying about it every week.
2. Keep Business Transactions in a Separate Business Bank Account
While the notion of separate finances between personal and business expenses seems obvious, many small business owners don’t get the memo. The truth is that you need to approach your expenses like they are oil and water. What that means is that they will never mix, period.
If you don’t already have a business account, stop reading right now and open one. Opening a business account ensures all your business-related expenses are ready-at-hand with no confusion. Over time, this can also help you build financial creditworthiness for additional lines of credit, loans, or other related benefits.
3. Create a Receipt Storage System
According to the Australian Taxation Office, record keeping is essential when it comes to your business receipts. According to their office, the law requires all the following considerations when it comes to your business expenses:
- You Can Adequately Explain All Business Transactions
- Your Receipts Are Expressed in Writing (Paper or Digital)
- Your Receipts Are Expressed in English or Can Be Easily Translated
- Your Receipts Are Kept for at Least Five Years
Because of the importance of this type of storage, you absolutely need a direct and simple receipt storage system for your records. This includes both digital and paper-based receipt storage.
While there is no one right answer to this task, there are several strategies you can take to make receipt filing and storage easier. These include the following:
- Folder-Based Filing for Each Year and Specific Subject
- Scanning Procedure with a Similar Filing Process
- Digital Filing Process for Electronic Receipts
In many cases, an integrated accounting/financial management software suite can help make this integration process much easier. In the end, it will save you time and energy while ensuring your records are all stored in an easy-to-access location.
4. Get a Professional Bookkeeper to Help
You’re a small business owner who is passionate about what you do. You spend your time and energy pursuing that passion to showcase what you do to your customers. And you work hard to become a preferred choice for each of your customers.
People choose your business because you’re good at what you do and you provide a personal, customer-oriented approach. Why wouldn’t you do the same thing when it comes to your bookkeeping?
If your business is growing or you don’t have the time and resources to worry about your own books, why not let a professional handle it?
Here are all the great advantages you’ll enjoy by letting a professional bookkeeper handle it:
- Significantly More Time to Focus on Your Business
- Potential Savings through Outsourcing
- Higher Accuracy in Records and Related Financial Matters
A professional bookkeeper will help to ensure that your books are handled – meaning you don’t have to worry about it any longer. Despite the expense for this option, you’ll definitely value the peace of mind (and extra time) you’ll enjoy when you work with a professional. In many cases, you’ll actually save money with a more efficient professional handling this essential aspect of your business.
5. Use an Integrated Finance Software Solution
Current technology options afford an impressive amount of options when it comes to small business finance. In fact, many cloud-based accounting and finance solutions can integrate your operations into one easy-to-use platform.
These software solutions can include all the following:
- Daily Operations
- Payroll Management
- Staffing & Related Employee Tasks
- Finance Report Generation
- Data Analysis & Forecasting
- Accounts Receivable
- Direct Integration to Your Bank
Several of these software solutions are oriented toward the small business owner. What that means is you can integrate these solutions into your business operations at an affordable rate – and often scale them based on your exact needs.
For many small business owners, this type of solution provides an amazing advantage to streamline bookkeeping operations while reducing costs for an even more efficient process. And as any small business owners knows, this type of savings can help your business succeed even more.