3 Aspects of Bookkeeping That Small Businesses Should Never Take Lightly

  Entrepreneurs who are new to business often fall victim to a dangerous rookie mistake.  Bad bookkeeping.  If there’s one thing that businesses should get right from the start, it’s accounting procedures.  No matter how big or small a company is, when bookkeeping standards are high, financial stability is always enhanced.

Good Books are the Backbone of Every Business:

Certified Public Accountant Krystal Witherspoon explains that, “Bookkeeping encapsulates the past financial performance of your company. To plan for the future, you have to have a good understanding of the past. Bookkeeping not only helps with planning for strategic purposes but also plays a major role in tax planning. It gives accountants the necessary information to properly categorize revenues and expenses.” Here are a few dynamics and best practices related to bookkeeping for small businesses:

1.    Timely Record-Keeping:

Companies perform countless transactions in real-time.  And each of these transactions has to be recorded and filed for critical reasons.  Procrastinating with recordkeeping puts companies on a path to delinquent tax compliance, among other problems.

2.    Tax-Return Filing Deadlines:

The biggest reason why bookkeeping needs to be organized is because financial records are expected to be reported within statutory tax deadlines.  Many tax deadlines are actually well-documented, and predictable.  This basically means that bad bookkeeping never suffices as an excuse for late reporting.

3.    Reliable Software and Information Systems:

The bad news is that bookkeeping is a complicated process. But the good news is that various resources exist to make accounting easier and quicker.  Especially technological solutions.  Picking the right software for bookkeeping sets a good precedent for future activities.

Conclusion:

The best thing a company can do to ensure its survival is to streamline bookkeeping.  And this is especially crucial for small businesses and startups.  The more familiar entrepreneurs are with accounting earlier on, the less exposure they’ll have to financial risks and emergencies. If you like what you just read from our blog, you’ll love the various informative courses, workshops, and events listed on our websites and social media. Whether you’re interested in personal development, or the overall improvement of your business, give us a call at 1 (800) 913-0222 to find out how Richard Martinez can help you break past your daily struggles and start soaring in success.