Bookkeeping is one of the things all businesses, irrespective of their size, have in common – we all need to keep our financial records up to date.
Many of my clients find this part of running their business difficult. They remember sitting in maths class at school and finding it difficult. They see Bookkeeping as maths homework. But it’s not!
Keeping the records of your accounting transactions up to date is a process. It’s about taking a piece of information and slotting it into the place where it belongs – like putting a book back on the self.
This leads into my first top tip: Have a system for your paperwork. As we’re trying to look at Bookkeeping as a process rather than maths homework, it’s important to have a system. The system or systems you use will depend on your business, but you’ll at least need to have a way to file your paperwork so that you can find things quickly and easily. You may also find it helpful to use a spreadsheet or accounts package to keep track of what you’re selling and buying. If you’re on the road most of the time, it might be worth considering an app to help you keep track of things too.
Once you’ve your system set up, make a habit of doing your books regularly. Schedule some time in your calendar each day, week or month to focus on slotting the information into your system. At the end of the year it’ll be easier to prepare your accounts (or for your Accountant to prepare them) as you’ll have most of the work done already.
If you’re doing your books regularly, you’ll already have my third tip covered: keep track of what you owe and who owes you. You are more likely to notice any problems with payments from your customers early if you’re keeping an eyes on what is owed to your business. Knowing what you owe your Suppliers will help you deal with any problems you may have paying the money you owe and prompt you to contact your Suppliers early to reach an agreement or actively look to collect some of the money owed to you.
My last tip is for business and personal use. Always read your bank and credit card statements. They may look a bit confusing at first, but take the time to understand what’s coming in and going out of the accounts. You might notice subscriptions you no longer need or incorrect entries which need to be resolved. It’ll also help you keep note of your cash flow which is vital when making purchasing decisions.
Just to recap… my top bookkeeping tips are:
- Have a system for your accounts paperwork and to record the accounting transactions of your business
- Make a habit of doing your books on a regular basis
- Keep track of the money you owe and the money owed to you
- Check your bank and credit card statements as soon as they arrive.
I hope you find these tips helpful. Remember, take the fear out of the figures by looking at bookkeeping as a process.
Founder, Exploring Solutions
Want to set up a system for organising your accounts paperwork, but don’t know where to start?
I might have the thing you’re looking for! I’m launching a step-by-step guide to help small businesses set up a simple system to organise their accounts paperwork. Drop me an email and I’ll let you know as soon as it’s launched.