Running a business means you have to deal with many daily tasks. With so much going on, it’s easy for bookkeeping tasks to fall by the wayside. However, keeping your books up-to-date is vital to running your company efficiently and successfully.
Yes, your company’s books are a barometer of how well it is doing—but if you’re not a “numbers person,” doing your bookkeeping may sound as appealing as a root canal. Others intend to review their business finances but get caught up in the day-to-day and never get around to it. Whatever your feelings about bookkeeping, it’s one of those tasks no business owner can avoid forever.
Learn some of our best bookkeeping tips for small businesses so that you know what to do if things get overwhelming.
1. Separate your personal and business finances.
Keeping your personal and business finances separate is important to running a successful, tax-compliant business. In fact, you can avoid a lot of headaches—and fines—by separating the two.
If you’re running your business as an LLC, you’ll need to keep track of your income and expenses separately for both types of accounts. This means you’ll have two sets of books: one for your finances and one for your business.
It may seem like extra work at first, but once you get into the habit of keeping them separate, it will become second nature!
2. Automate as much as you can.
As a small business owner, you probably know that the only thing harder than running your own business is managing to do it all on your own.
You’ve got to be your own HR department, accountant, salesperson, marketer, and much more. And while it’s tempting to let yourself get overwhelmed trying to manage all of this… well… at some point, you have to ask: how long will you keep doing everything?
It’s time for you to automate as much as possible. For example, automated emails save time and effort by sending important information directly to your customers’ inboxes. An automated payroll system can help ensure that you pay employees on time—and with no mistakes!
Automation isn’t just about making things go smoothly—it’s also about freeing up your time to focus on what matters most: growing your business!
3. Conduct regular financial audits.
Keeping up with bookkeeping can be difficult, especially if you own a small business. However, it is critical to conduct regular financial audits.
You end up with bounced checks, overdue invoices, or figures that don’t add up if you put off bookkeeping for too long.
Check your books every week to ensure that everything is in order.
4. Use time-tracking software to keep track of your employees’ working hours.
Tracking your employee’s hours can be a daunting task. So many things can go wrong, and it’s hard to know what is happening.
For example, you may have an employee working more hours than they are supposed to be. Or maybe they are taking too much time off. Either way, these things can cost you a lot of money and make your business look unprofessional.
To avoid this problem, we recommend using time-tracking software to keep track of your employees’ working hours. It will help you see exactly how much time each employee spends at work and how much time they take off. This will allow you to quickly identify any issues before they become severe problems in the future!
5. Accounts receivable should be closely monitored.
If you ignore accounts receivable, your business could be in danger.
When customers don’t pay on time, your business’s cash flow can dry up fast. It’s not just the lost revenue—it’s also the cost of carrying that debt until it gets paid off.
The solution is to keep an eye on your AR balance and ensure it stays as low as possible by working with customers to get them to pay more quickly and easily.
6. Keep track of tax deadlines.
Tax time can be stressful, but it doesn’t have to be. If you keep track of your tax deadlines and set aside money for anticipated bills well before the deadline, you’ll avoid fines and other penalties that could affect your business’s bottom line.
The IRS website has a tax calendar for businesses that sync with your cloud-based calendar, so you never miss a deadline. It also sends reminders a week or two before payments are due—so if you’re late paying, it won’t be because you forgot!
7. BookkeeperLive can assist you.
It’s important to have your finances under control, and we all know that. But sometimes, it can be hard to keep track of all the details and ensure you’re on track, especially if you’re in a busy season of life.
But don’t worry! We’ve got your back.
BookkeeperLive offers regular financial audits to stay on top of your business and keep your employees happy. We’ll take care of all the paperwork for you so that when tax time comes around, you can relax and know everything is squared away.
BookkeeperLive provides bookkeeping services and accounting services at affordable prices. We will work with you to determine your needs, create a plan for reaching your business goals, and implement that plan.
Our team of experts can handle everything, so you can focus on running your business!