Microsoft Excel is a life saver- calculations, bookkeeping, accounts, you can do it all. However despite the many benefits of Excel, it may not be the best choice for business or simple bookkeeping. Let us take a look at why it may be time for you to move on.
- Time Consuming– While Excel may be a time saver when compared to the traditional method of maintaining ledgers, it is time consuming when compared to the modern bookkeeping and accounting software available. Creating a useful spreadsheet that meets your needs in Excel requires a lot of planning. You need a clear picture of what you want and how it should look before you even start on the sheet.
- No Way to Track User Activity– If more than one person has access to the Excel document, there is no way to track who made what changes. This makes it easier for fraud to occur.
- Easy to Make Errors– It is easy to make errors in Excel, like linking wrong cells, and since Excel doesn’t warn you of potential errors, you will most likely work with the error for months before even knowing something is wrong. Such errors can be detrimental to your simple bookkeeping and often even be costly.
- Mastering Excel– Excel is more than just a simple spreadsheet; Excel has many built in functions and formulas which can make your work a lot easier. To use this program well, you have to first of all know Excel in and out. Learning and mastering Excel can be time consuming and tiring.
Things are changing. Science and technology is changing the world and every sphere of life, from healthcare to research to simple bookkeeping. If you want your business to make a mark in this competitive world, you have to make sure that you make use of all the resources available to you, that includes software, equipment, tools. Don’t stand back.
Bookkeeping has no place in most business owners’ “My Favourite Things” list, and that’s understandable because most business owners and entrepreneurs are all about the business and doing what they like doing best, which means that all the figures just get in the way. However, whether you like it or not, as long as there is money involved in your business, you need simple bookkeeping and accounting. So as an entrepreneur who dreads watching the numbers and keeping track of the money, what are a few things you can do to keep track of your bookkeeping?
- Hire a Bookkeeper– It is indeed that simple- just hire a bookkeeper. Yes it is an additional expense, but you might find that the benefits outweigh the cost. You will no longer have to worry about your books; they will be up-to-date and accurate and you can spend the time to focus on more important business aspects. Most importantly, you will always be on top of your financials. Leave the simple bookkeeping to the professionals.
- Store Receipts– You need your receipts for accurate bookkeeping. Without the receipts the chances of you mixing up charges are higher, plus you will need the receipts in case of an IRS audit. Now piles of receipt is not what any business owner or bookkeeper wants, that is where simple bookkeeping software like QuickBooks can help. You can upload images of the receipts and store them for future reference, thereby saving physical space and meeting your bookkeeping needs.
- Keep Track of Your Invoices– Most business owners issue invoices and then forget about them, most likely because of existing number of unpaid invoices. A rule of simple bookkeeping is that you keep track of the invoices and payments that have been made. Follow up regularly on pending payments or you will end up with a cash flow problem.
If you run a business, big or small, you cannot do without bookkeeping. Bookkeeping keeps the blood pumping through your business, so make sure you give it your best shot.
Business owners are always busy; 24 hours seems like too little time for many. So how do they make the most of the 24 hours that they have? They focus on the tasks that they absolutely cannot overlook and ignore the ones that they can, which they generally outsource; tasks pertaining to simple bookkeeping, accounting, payroll, recruitment and the like.
Now, you may think that just because you have outsourced the task, you don’t have to worry about it. True, you don’t have to; but the thing is that the reports generated by your bookkeeping and accounting team are priceless. They provide a lot of information about your business. Let us take a look at some of the reports generated by your simple bookkeeping team and what it can tell you.
- P&L Statement– P&L statement provides a comprehensive financial report for a fixed period of time. The report provides information about revenues, costs and expenses. A thorough analysis of this report can give business owners a lot of data helpful in making informed business decisions.
- Profitability Ratios– Profitability ratios are a way of measuring a company’s performance, by assessing its capacity to make profit. There are different types of profitability ratios, what they all ideally try to do is measure by how much your revenue exceeds your expenses. It is a valuable source of information for any business- you can gauge how well your business is doing, compare yearly performances and watch for trends and seasonal patterns. This can affect the way you do business.
Never make the mistake of ignoring your simple bookkeeping and accounting. These non- core business functions have a major role in the growth and development of your company. You can learn a lot from the reports your bookkeepers send you regularly. If you find you cannot understand the reports, you can always ask your bookkeeper or accountant to help you out. Soon you will be able to analyse and review all financial reports yourself.