Entrepreneurs have so much on their plates that many of them don’t want to, or don’t have the time to, address their bookkeeping and accounting chores. As virtual accountants we know this is true. We also know that tracking income and expenses and maintaining proper records for tax and accounting purposes are crucial tasks that entrepreneurs must address.

If you’re an entrepreneur and want to do the basics of your business bookkeeping, here are some of the items you must address:bookkeeping

  • You need to balance your checkbook. Just as you should balance your personal checkbook, it is important that you balance your business checkbook. When you’re doing this you will have a clearer picture of your cash flow and catch any errors you may have made.
  • Track your client transactions. The volume of your business may determine how often you do this, but we recommend doing at the end of the day, if possible, or weekly if that isn’t.
  • File receipts. You don’t want to use the shoebox method of filing receipts. Scan them or use a phone app to keep them paperless. The added benefit here is that your receipts won’t fade away to nothingness. Do this frequently so you don’t forget what the receipts are for. We recommend to our clients that they write what the receipt is for on it when they take it out of their pocket, purse or bag. As a backup you can keep the original receipts, if you choose to.
  • Review your profit and loss statements. This report will show you whether you are operating at a profit or a loss. Identifying this – as soon as possible – will help you to make course corrections in the way you do business. Don’t make the mistake many new business owners make of thinking that the cash in their bank account is their profit. It is not!
  • Work with an accounting professional. Your CPA will be invaluable to you to get your business off on the right foot and to devise tax strategies for you as you grow. We know that your core business competency may not lie in the accounting area, but ours does. 75% of our clients are referred to us by their CPA. We handle the accounting tasks for our clients so they can concentrate on growing their business. If you don’t have the time or desire to do your own bookkeeping or accounting, look for a firm that can take that task off your plate.

What tasks do you have on your plate that you could outsource as a way to save you time and money?

 

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