When it comes to running your own business, keeping your accounts up-to-date is a must. You might start out with the best intentions, but with the flurry of the day-to-day grind (especially when business is going well) it’s easy to end up off course and with piles of paperwork everywhere! Rather than picking up the pieces later, it’s best if you can stay on track from the start. Here’s our tips for keeping your accounting organised!
- Separate Business Accounts
Mixing up business and personal accounts is a disaster waiting to happen. If you’re running your business full time, make sure you set up a separate account for your business transactions. These days there are practically zero fees for setting up a business account, which also means zero excuses.
- Smart Software
Using software to make sure your books are regularly and correctly reconciled will save you future headaches. Xero is a favourite of many accountants, but QuickBooks and MYOB are also relatively inexpensive and user friendly. You can input expenses and deductions directly into the software, rather than excel so you’re constantly on top of your incomings and outgoings. Your finances are also displayed with pretty graphs, so it’s easy to track your performance.
- Implement Processes
Ideally, you should have a dedicated day per week, or at the very least, per month, where you catch up on all of your financial admin. A shoebox or manila folder may work as a temporary method of storing receipts or invoices, but only ever temporary! So that you don’t end up with a box of random paperwork at the EOFY to handover to your accountant (and in turn give them a heart attack), come up with a simple process for regularly inputting your expenses online.
- Record Accounts Received
If you have your software and processes all figured out then this should be a breeze. Ensure that you record every time a client pays their invoice. This will assist with not only keeping track of your bottom line, but will also help you stay aware and on top of any outstanding debts. And don’t forget about accounts payable either… you don’t want to have any outstanding invoices that suddenly sneak up on you!
- Avoid Cash
Cash is notoriously difficult to track and stay on top of. If you do need to pay for a surprise client coffee, make sure you reimburse yourself with an expense claim. It may seem like overkill, but over time it will prevent multiple cash transactions eating into your revenue. Of course, the same goes with payments. Collecting payment online will prevent extra to-ing and fro-ing with banking and entering into online systems. It will also reduce the temptation of simply slipping it into your back pocket and throwing your accounts completely out of whack.
For more information on how to stay organised with your accounting, email firstname.lastname@example.org today!