Even though it might not be the most fun aspect of running a business, bookkeeping should always be near the top of your to-do list. Whether you keep your books on paper, through digital software or hire a financial expert, bookkeeping is extremely important part of any business.
Bookkeeping establishes compliance with a number of IRS regulations and bank lending rules, as well as improves your ability to make operational decisions. So where do you start? Here are a few bookkeeping basics to keep in mind.
- Choose a bookkeeping system.
Double-entry bookkeeping is appropriate for a business because it tracks two accounts at a time. Say you sell a product: Double-entry bookkeeping records the transaction as a credit in your cash account and a debit in your inventory account. - Capture financial data.
Make a habit of holding on to everything including: purchase orders, sales receipts, bank statements, etc. Tip: Create a filing system that contains a place for every type of financial data. - Information to Include in your Books.
As a standard practice, the following pieces of information should always be kept in your books: revenues and expenses, cash expenditures, inventory, accounts receivable and payable, and employment records. - Get help.
Last but not least, if you’re like most small business owners, you lack both the time and eagerness to keep up with bookkeeping. Therefore, find a good CPA in your area.
William Wolske, CPA wants to be sure you are making good money decisions when it comes to your business. Schedule your free consultation today to receive assistance when it comes to handling your finances and money saving goals. Contact our offices at 843.706.9644 and we’ll go through your financial situation together, helping you determine your best bookkeeping practices.