Keeping on top of daily operations, maintaining accurate, up-to-date books and meeting tax deadlines, are all tasks small business owners must grapple with. But when added to the long list of other tasks they’re expected to deal with – not to mention the ongoing stress of maintaining a business – the workload can feel overwhelming and headache-inducing.
However, with help from an experienced bookkeeping company, small business owners can at least put the worry of their books and taxes behind them. In fact, there are plenty of things business owners can do themselves to help make bookkeeping less of a headache, including the following:
- Set up a system for bookkeeping
Without a robust system in place to track records and keep financial records in order, it’s hard for any business to be efficient with its bookkeeping. From accounting software to a manual ledger or spreadsheets, a good system is key to organized bookkeeping.
- Categorize your financial records
Setting up a filing system for things such as invoices and receipts, payroll records and bank statements, helps small business owners keep their financial documents organized, and readily accessible whenever they might need them.
- Accurately and promptly record all transactions
All business transactions, including income and expenses and many more, should be dealt with promptly, and recorded accurately. By doing so, business owners can make sure that the true health of their company’s finances are always reflected.
- Ensure bank statements are reconciled
Spotting errors or discrepancies is made much easier when bank statements and bookkeeping records are regularly reconciled.
- Regularly generate financial reports
When financial reports, such as balance sheets, cashflow statements and profit and loss statements, are regularly reported, business owners can better analyse their financial performance and gain valuable insights into such things as their expenses and revenue, and the company’s financial health overall.
- Review and analyse financial data
When business owners regularly review and analyse their financial data, they can identify areas of improvement, trends, and patterns, which can help them run their business more efficiently and make changes that support their growth.
Should you hire a bookkeeper, and if so, when?
For any business dealing with complex financial transactions, hiring a local bookkeeper can ensure that the books are always accurate, and always up to date. In addition, they can provide business owners with financial insights that can prove invaluable, helping businesses to grow and be more profitable overall.
But bookkeepers aren’t just for people with complicated financial transactions; even if you don’t feel your books to be particularly complex, and you have the time to handle your own bookkeeping, doesn’t necessarily mean that it’s a good idea to do so. Bookkeepers naturally have the training and expertise to deal with financial records and taxes efficiently; and can not only help you save money but also stay tax compliant.
The tax system in Canada can be complicated, particularly for business owners without any prior experience. But with help from bookkeeping services, you may be able to access tax deductions that you didn’t know you were entitled to, and perhaps more importantly, meet deadlines that if missed, could result in hefty penalties and fines.
Bookkeeping doesn’t have to be a headache, and while as tempting as it may be for small business owners to tackle their books themselves in an attempt to save money, rarely is it as cost-effective as it may initally seem.