10 Tips for Better Small Business Bookkeeping

Whether you are a "number person" or not, in fact, bookkeeping is one of those tasks no business owner can avoid forever. Your business books are a scorecard of how well your company is doing. Here are 10 important tips to make small business bookkeeping easier.

#1. Separate Personal and Business Finances

First thing to do before going through with your startup is to open a business bank account and a separate business credit card. Using your personal bank account for business purposes is a common mistake in small business bookkeeping and causes huge headaches for your business in the future. Separating personal from business will also help your business build its own credit rating.

#2. Automate as Much as You Can

Entering data into Excel spreadsheet and reconciling numbers manually is so old school. Use cloud-based bookkeeping software, and do your business banking online. That way, you can sync your bookkeeping software with your business bank account so you always have accurate, up-to-the-minute records. Plus, with the cloud, your critical financial data is backed up safely off-site.

#3. Ask a Pro

It's important to consult an accountant about a software that best fits your business needs. Your accountant should be able to not only offer advice but also set up the software for you and show you how to use it, and if you are not a "number person" you can have an accountant do your books for a long term run.

#4. Maintain Records of Business Expenses

Maintaining records of business expenses is important especially when it comes to tax deduction. For guidance, you should consult your accountant about expenses that can be claimed as tax-deductible. Save your time and scan all business receipts by scanning and digitizing them. You can simplify tracking your business expenses by using a business credit card.

#5. Do Monthly Reviews.

At the end of each month, take an in-depth look at your bookkeeping and accounting records. Look for trends, such as growing or declining sales, revenues, or an increase in late-paying customers. Always stay in touch with your accountant so he or she can help you understand your overall cash position and advise you on future capital needs such as moving to a bigger office space or getting new equipment.

#6. Perform Regular Financial Checkups.

Let yourself or your accountant go over your books at least once a week in order to make sure things are on track and going smoothly. If you put off bookkeeping too long, you end up with overdue invoices, returned checks, or figures that don’t add up.

#7. Monitor Your Employees’ Hours With Time Tracking Software.

Cloud-based time tracking software allows employees to clock in and out on their smartphones, tablets or computers. This saves them hassles and meantime makes your life easier to track their worked hours, overtime hours, PTOs, and so on in one cloud. You can easily find time tracking software specific to your industry needs.

#8. Pay Attention to Accounts Receivable.

Your business’s cash flow can dry up fast when customers don’t pay on time. Pay attention to when your receivables are due and contact late-paying customers right away to nudge them along. Even if a customer is having financial problems, you may be able to set up a payment plan to get at least some of what you’re owed.

#9. Meet Tax Deadlines.

Always plan ahead and set aside money for any anticipated tax bills. Pay on time so you don’t face late fees and fines. You can sync IRS website’s tax calendar for businesses with your own cloud-based calendar so you never miss a deadline; it has a feature even to send you reminders a week or two in advance when a payment is due.

#10. Get Help From Customer Service.

Are you having technical issues with your accounting software? Getting a cloud based accounting software with unlimited customer assistance is the best option for you! Get your issues fixed and questions answered by calling and addressing them the issue you're going through.