Tag Archives: bookkeeping for small business

What You Need to Know Before Outsourcing Bookkeeping

Outsourced bookkeeping services are popular today; they are efficient, effective and saves money and time. Most small businesses find themselves looking for companies that offer bookkeeping for small business because it would make life a lot easier for them. However before you decide on an outsourced bookkeeping services company, there are a couple of things you ought to know.

  • The Website Doesn’t Say It All– Getting a professional attractive website is extremely easy today; all you need is money and a good website designing company. It is easy to create an illusion of professionalism and tenure with a well designed website, so never go by what the website says. While the website should help you shortlist your choices, it should not end there; you have only begun your search for help with bookkeeping for small business.

Bookkeeping for Small Business

  • Find Out Who You Are Dealing With– The next step is to find out who you are dealing with. Check out the Team page, find out how many people they have on their team. Check the company’s LinkedIn profile and the employees connected to the company, their experience etc. Thoroughly research the company’s background, reviews and qualifications before taking any decision.

Outsourced Bookkeeping Services

  • References and Referrals– References and referrals are by far one of the best ways to assess a company. Ask around; ask people you know if they or anyone they know has experience with the company you are looking into. When you have established a relationship with the company, you could ask them for the details of existing clients so that you can talk to them about their experience. If they are not willing to share details, there is reason to believe that there may be something they are hiding and you might have to drop them. Better safe than sorry.

Selecting the right company for bookkeeping for small business is not a task to be taken lightly. With a little care you will get it right though.

Getting Things Together after a Natural Disaster

Sometimes things go bad, and sometimes it happens to you- it could be an earthquake, hurricane, floods; the possibilities are numerous. While you cannot predict and prevent disasters from occurring, you can take steps to ensure that your business recovers from the tragedy. Here are some tips to help you and your business recover from a disaster.

  • Take Steps to Ensure the Safety of All People on the Premises– The first step is such circumstances is to ensure that you, your loved ones and the people at your workplace are safe. Follow up on the instructions provided by the local authorities and adhere to them. If you are outside, finding a safe place should be your first priority.

Bookkeeping for Small Business

  • Report Losses to Insurance Company As Soon As Possible– Make a list of all damaged and destroyed items and report the losses to the insurance company as soon as possible. Keep this list safe along with the receipts of the new purchases. You will need this for the insurance claim, bookkeeping for small business and for filing tax returns.
  • Take a Look at Your Expenses– The disaster means unexpected purchases and expenses, so take a look at your expenses and where you stand financially is important. Shut down any utilities that aren’t being used, review your budget, bookkeeping for small business and clear out unnecessary expenses.

Natural Disaster

  • Avail of Disaster Assistance Loans if Needed– If you find that the damage is too much and you cannot meet the expenses, you could consider applying for a disaster assistance loan. The SBA gives loans to homeowners, renters, businesses and non- profits to replace property and equipment lost or damaged in natural disasters.

No one likes to be a victim, but when that does happen, all you can do is do your best to get things together.

Employee Reimbursement for Small Businesses

Over the last decade, employment and staff dynamics has witnessed a lot of change. Aside from a change in the relationship shared by employers and their employees, there has been a change in the way people work- home based workers, contract employees, mobile employees, the options are many. All this means employers have to change their regulations and system; one such change is employee reimbursement, which forms an important part of bookkeeping for small business. All expenses incurred to run your business are business expenses, so all expenses incurred by your employees in order to help run your business are expenses and hence should be compensated. Communication, transportation, internet are examples of employee business expenses. If you cannot provide for all these, you should clearly define what expenses you will reimburse. Let us take a look at some common employee expenses that are reimbursed in bookkeeping for small business.

  • Company Travel– Some jobs demand frequently travelling to meet clients, attend conferences or meetings. All expenses that are incurred by the employee when away from home are travel expenses and have to be considered for employee reimbursement. As an employer, it is your responsibility to clearly list what expenses will be covered under this for bookkeeping for small business, for example, lodging, food, transportation etc, and what won’t.

Bookkeeping for Small Business

  • Insurance– Liability, malpractice and vehicle insurance are few types of insurance that are necessary for certain jobs. If any insurance is needed as part of the job, the company should make provisions for reimbursing the expenses when bookkeeping for small business.
  • Communication– Employees today can work from home or work on the go. They will however have to be connected to their employers and team; the expenses incurred in this respect are referred to as communication expenses. Telephone charges and internet costs are generally covered in this. Make sure you think through your communication reimbursement policy and list it clearly for employees.

Employee Reimbursement

  • Other Types of Reimbursement– We live in a competitive world, whether you are an employee or an employer. As an employer, it is important that you have some form of employee reimbursement in place to retain employees. This can include technology upgrades and incentive plans. To attract and retain good and loyal employees, you have to be able to anticipate their needs and meet them.

Change How You Communicate with your Bookkeeper

We have often stressed how important communication skills are in a bookkeeper, however it is important to note that communication is a two way process, so it won’t help your bookkeeping for small business if you cannot communicate with your bookkeeper. Business owners often complain about how their bookkeepers don’t give them the report they asked for or provide them with incomplete information. While it is possible that your bookkeeper is at fault, it is also equally possible that you are at fault; maybe you didn’t clearly state what you need, maybe you assumed that your bookkeeper knows what you are talking about. The only way to establish this for sure is to make some changes to how you communicate with bookkeeper. Here are some easy changes you can make.

  1. Set aside time to review and request bookkeeping for small business information– Most business owners are in the habit on making requests while on the run, which means they end up not explaining things to the bookkeeper. While they know the context, the bookkeepers most often don’t, and provide information based on what they understood. The best way to fix this is to purposefully set aside time to interact with your bookkeeper, whether over the phone or in person. Just make sure you concentrate solely on your bookkeeper and that the both of you are on the same page before closing.

Bookkeeping for Small Business

  1. Insist on emails and notes for communication– It is good practise to conduct all your requests and communications via emails. Emails require you to think before you write and it also serves as a means of documentation. Make sure you make notes for every meeting and pass them around later, so that changes can be made by those involved if needed. This can save everyone a lot of time, trouble and prevent miscommunication.

Communicate With Bookkeeper

  1. Provide feedback– Bookkeepers can also benefit from constructive criticism and detailed feedback. Make it a point to provide your client with regular feedback, so that he knows where he stands. Besides it will allow you to engage with your bookkeeper and develop a healthy relationship.

Bookkeeping for small business has its ups and downs, and there is nothing that you and your bookkeeper cannot solve together. So make a few changes and watch things change.

Why QuickBooks is Good for Your Business

A lot of business owners are turning to QuickBooks for accounting and bookkeeping help. QuickBooks is probably one of the most popular accounting software to turn to for small and mid- size business bookkeeping and accounting. Here is why numerous companies turn to QuickBooks for accounting and bookkeeping.

  1. Time Saving– With QuickBooks you save a lot of time as the software allows you to automate numerous simple bookkeeping and accounting tasks.
  1. Affordable– Investing in QuickBooks will only require a fraction of the resources needed if you hire a bookkeeper or accountant for your business.

Bookkeeping for Small Business

  1. Fewer Errors– QuickBooks greatly reduces the incidence of errors in your books. Human errors can be eliminated especially since calculations are done by the software itself.
  1. Customizable– QuickBooks can be customized to meet your business’ requirements and needs. This software is designed to be flexible and adaptable for individual businesses.

QuickBooks for Accounting and Bookkeeping

  1. Reliable and Efficient– QuickBooks is reliable and efficient. The software is capable of maintaining your books accurately and keeping it up- to- date.
  1. Facilitates Growth– Using QuickBooks frees up a lot of resources and automated processes, which means that you are in a better position to grow your business. One of the benefits of using a bookkeeping and accounting software like QuickBooks is that you have a system in place that supports scaling. When you scale you won’t have to worry about your bookkeeping for small business not being able to catch up.

There are numerous benefits from using a software like QuickBooks for accounting and bookkeeping for small business. Add to this the fact that it is also relatively easy to master and you have a winner, so give QuickBooks a shot. You may find that it is just what your business needs and you will also see for yourself why numerous businesses turn to QuickBooks for accounting and bookkeeping.

Handling Small Business Debts

Does your small business have debts? Well if it does, there is nothing to be ashamed off. Most small business owners have debts on their business and most often than not, feel quite uncomfortable it. So, you have small business debts; big deal. What matters is that you find a way out of it soon, so how do you do that? We have some suggestions.

  1. Assess Your Debt– The first thing you need to do is assess your small business debts and find out how much you owe the lenders. So sit down with your bookkeeper who takes care of your bookkeeping for small business and go over your debts. Decide how much of cash you can allocate to clear the debts and accordingly prepare a monthly budget. Identify ways to keep the cash flowing so that your debt is cleared as soon as possible.

Bookkeeping for Small Business

  1. Re-structure Your Debt– Look for ways to re-structure or reduce the loan as much as possible. Identify loopholes in the terms of the loan. Negotiate with your vendors on the payment terms and see if it makes a difference.
  1. Clear Monthly Dues When Payments are Received– As soon as you receive payments, make sure you send the amount set aside for clearing the debt says bookkeeping for small business gurus. This is simply because the more you wait before making the payment, the higher the chance of you using it elsewhere. If you don’t have the money, how will you send it?

Small Business Debts

  1. Generate Greater Income– Easier said than done! But it is true, the more you make, the sooner you will be debt- free. Revisit your market strategy, increase prices, diversify, tap into newer opportunities, utilise bookkeeping for small business- you will be able to find a way to generate more incomes so that you can address your business’ needs.

No one likes being in debt and it is normal to feel overwhelmed by your small business debts. What you need to do is make sure that it doesn’t stop you from doing all you can to reduce your debt. And once you have cleared the debt, try your best not to get into debt again. You know how hard it is to get out.

5 Financial Planning Tips for Small Business Owners

Finance is generally not the strong suit of most small business owners. The numbers don’t make any sense and they can be overwhelming, but whether you like it or not, finance is an integral part of your business. It is important that you realise it from the very start; to ignore it is detrimental to the growth and development of your business. Here are some financial planning tips that can help your small business.

  1. Keep your Operations Lean– Most business make the mistake of investing in grandiose offices and hiring more staff than they need before the business as stabilized. Think about what you need, not what you want and plan accordingly. Don’t drive your business into the ground. Think rationally and plan.

Bookkeeping for small business

  1. Don’t Ignore Your Bookkeeping and Accounting– A huge mistake that a lot of entrepreneurs make is ignore accounting and bookkeeping for small business. This can turn out to be a costly mistake. The more you put it off, the bigger a mess it will be. You will have trouble when its tax time and will never have an idea of where your business stands financially.

 

  1. Be Prepared– You never know when disaster will strike; so be prepared for risky times. Regular risk assessments are a good way of assessing your business and where it stands. Manage your cash flow carefully, ensure accurate bookkeeping for small business and have risk strategies in place to counter any turbulence.

Financial planning tips

  1. Seek Funding When the Market is Up– Getting a loan when the market is down may prove to be difficult especially after the recent financial crisis. So be smart and secure funding when things are good. Don’t wait for things to turn for the worst.
  1. Invest in Technology– Technology has touched all facets of business- HR, payroll, inventory management, supply chain management, bookkeeping for small business and more. These latest solutions are cheaper, effective and efficient. Invest in useful software, tools and cloud computing solutions.

What to Look For When Hiring a Bookkeeper

Bookkeeping is an important part of any business; hence it goes without saying that your bookkeeper is also vital for the smooth and efficient running of your business. Unfortunately most small business owners feel that bookkeeping is out of their league and so don’t know what to look for in their bookkeepers. While the basic criterion is that they are well versed in the principles of bookkeeping for small business, there is a lot more that you should look out for. So let us take a look at what else you should expect in a bookkeeper.

  1. Good Communication Skills– Good communication skills are important for success in any field. How can you work with your bookkeeper if he/she doesn’t understand you or has trouble talking to you? A good bookkeeper is a valuable asset and can provide information useful for the growth and development of your business.

hiring a bookkeeper

  1. Basic Understanding of Your Industry– A bookkeeper with experience working in your industry will find it easier to navigate and get things done for you. While the essentials of bookkeeping for small business are the same for all, there will certain terms specific to the industry which the bookkeeper can understand only from experience.
  1. Knows How to Use Computers– Every sphere of life today is governed by computers and the internet, same goes with bookkeeping for small business. So, the smart and efficient bookkeeper of today should know how to use computers and accounting software like QuickBooks and Xero so that you can stay on top of your finances and reap the benefits of using these tools.

Bookkeeping for Small Business

  1. Attention to Detail– One of the reasons why bookkeeping is such a headache for small business owners is because there are so many small details that require your attention. Ideally a good bookkeeper will be able to pay attention to all the tiny details and give you accurate and up-to-date books.
  1. Have Financial Statements Ready on Time– As a business owner, financial statements and reports are extremely important to you and it is imperative that they are correct. Hence your bookkeeper should be able to provide you with the accurate reports and statements, namely the balance sheet, the profit/loss statement and the cash flow statement on time.

Hiring a bookkeeper is not a task to be taken lightly. Take your time and ensure that your bookkeeper has these qualities and any other qualities that you feel are important based on your prior experience with bookkeepers. If you can think of any other important qualities, leave us a comment.

Accounting and Bookkeeping for Start-ups

You finally did it! You are running your own business- a dream come true. After all the planning and running around, your business is finally up and running; but all entrepreneurs know that it doesn’t end there. In fact, it has only just begun; sustaining your business and growing it steadily is tougher than setting it up. This is precisely why all small business owners become engrossed in running the business and end up ignoring something vital to keeping their business afloat- their accounting and bookkeeping.

Why is accounting and bookkeeping for small business so important? Simply because both keep track of your money and money is the first indicator of where your business is headed- to success or failure. First things first- let us understand what accounting and bookkeeping are and how they differ from each other. Bookkeeping is the daily activity of recording and categorizing transactions and reconciling accounts with bank statements, while accounting is the next step of analysing the bookkeeping data to understand business progress and trends to make informed business decisions.

Busy females

Now that we have established why accounting and bookkeeping for start-ups is important, the question is how can you take care of it.

  • Use spreadsheets- Well, you can always choose to handle the accounting and bookkeeping for your start-up yourself using spreadsheets; it is not really that difficult. The problem however is that this can take up a lot of time, time that you could have otherwise spent on growing your business. If you are not careful, you will end up neglecting either your business or your books; neither a favourable outcome.
  • Use an Accounting Software- This is better than using spreadsheets, but the responsibility of maintaining the books will rest on you, thereby eating into your time.
  • Hire a Bookkeeper/ Accountant- Definitely the easier option but can be a problem if you don’t have money to spare, especially when you are talking about accounting and bookkeeping for start-ups.

Research and choose wisely; find the option that best suits your needs.

bookkeeping for small business

There are a few basic things you need to keep in mind for effective accounting and bookkeeping for small business.

  • Maintain accurate and up-to-date records. Might seem obvious, but you will be surprised to know how easy it is to not do so.
  • Track expenses carefully and keep copies of all transactions, payroll data, payments and organizational documents.
  • Schedule and perform regular end-of-period procedures like balancing accounts, reconciling bank statements etc.
  • Maintain perfect tax records and pay your taxes on time.

Accounting and bookkeeping for small business is definitely not easy especially if you are a start-up but it is not impossible. With the right guidance and support and a little bit of patience on your part, you can get a handle on it.

5 Bookkeeping Tips to Remember for Small Businesses

If you are the regular small business owner, chances are that there is probably nothing that you hate doing more than bookkeeping. No surprise there because unless you have a head for numbers, it can be an arduous task. Unfortunately, whether you like doing it or not, it is essential to keep your business afloat and to keep you out of trouble with the IRS. So, here are some bookkeeping tips for small businesses that will keep you on top of your finances and make your life easier.

  1. Set Up a Bookkeeping Process

It is essential that you have a bookkeeping system and that everything is not in your head. Don’t take bookkeeping lightly. When the IRS comes knocking, you will definitely not be laughing, so make sure you have a system. If you don’t know how to proceed, get professional help.

bookkeeping tips for small businesses

  1. Keep Aside Tax Money

Who doesn’t dread tax time, but you can make it better for yourself by setting aside the money systematically throughout the year. You know when you have to pay your taxes, so be prepared and make sure you have everything in order. It would be wise to remember that the IRS can penalise you for not filing quarterly tax returns on time.

  1. Record Expenses

One of the basic rules of bookkeeping- record your expenses at all times no matter where you are. If you do not know where your money is going, you are en route to financial ruin. You will also need the information for your taxes; otherwise you might end up missing some tax write-offs.

  1. Track Deposits

Another basic of bookkeeping for small business- make sure you record all your deposits and incomes accurately. Tracking expenses and deposits are important to ensure that your activities balance each other out. Besides if you don’t, you might end up paying taxes on money that isn’t income.

bookkeeping for small business

  1.  Following Up On Invoices

Any small business will fall if the pile of late and unpaid bills continues to mount, so it is vital that you have personnel dedicated to following up on billing and collecting payments on time. If your cash flow is hit, you will find yourself in serious trouble.

Bookkeeping for small business may not be easy but you can make it easy for yourself by following these simple bookkeeping tips for small businesses.