How to do Bookkeeping for your Small Business?
5 Tips for SME Bookkeeping
Small and Medium Enterprises in the modern day and age are struggling day in and out in order to ensure that they are able to maintain their accounts. It is important for them to do so, so that their integral and important information is intact, and they are subsequently able to measure their performance over a given period of time. Mostly, small and medium enterprises find it hard to keep up track of their finances, which ends in these businesses spending excessively, and eventually sliding into liquidity issues. However, there are some tips which can be taken into consideration in order to ensure that small businesses are able to keep their accounts intact.
- Plan ahead : Planning ahead is a very important tip for any small business. This helps them to create a budget, and ensure that they are able to keep track of the overall need of finances they would need for the business. Planning is a very crucial element, that will not that help them in maintaining their overall records, but will also help them to keep the relevant records in order to plan for the subsequent season. Book-keeping in one season, or one period, can be an excellent planning tool for the next year.
- Learn software like Excel : Microsoft Excel stands to be one of the most important tools that can be taken as an alternative to book keeping. Given the fact that not all organizations can afford to have an accountant on their site, it becomes highly important to have one of the staff learn basic Microsoft Excel tools. There are free training modules that are readily available online, and can be used for day to day data entry.
However, in exception to this, there are also plenty other tools available online, which can help businesses of a smaller size manage and maintain their books. It is integral to realize the overall need to have a proper software designated for specific purpose.
- Organizing Business Documentation : Documenting and keeping a solid track record of all business transactions is a number one priority for almost all businesses. As a matter of fact, it gets rudimentary to ensure that all businesses, regardless of their size are able to keep receipts and records of the expenses that they have incurred. Furthermore, it is also highly important to ensure that they are able to record all the relevant invoices against the sales that were made in the given period.
- Outsourcing book-keeping when it gets too hard for the internal staff to handle: Mostly, when businesses start off, they do not have a considerable number of transactions to record. However, as time progresses, these number of transactions increase considerably, so it might not always be easier for the current staff to manage this. At this point in time, it is perhaps the best decision for companies to be able to realize that there is a need to outsource this particular department, and get specialized help to conduct book-keeping for them
- Keep monthly checks and balances : For small businesses, inconsistency in terms of maintaining bookkeeping is often a major cause of concern. Therefore, it is the best strategy for business owners to be able to revisit their accounts every month, to check if all entries have been made in a proper fashion. These spot checks, and consistent updates to these journals can really set a good precedent for the company, and hence, it can help them in ensuring that they are able to follow the required protocols over the due course of time.