When you own a small business, one of the most important things you need - timely, accurate financial accounting records - tends to fall to the back burner while many of your other responsibilities take precedence. How can you possibly expect to juggle it all efficiently?
CSI Accounting & Payroll has worked with thousands of small businesses over several decades, so we know that it is essential that your accounting is organized, current, and handled on a monthly basis. This will avoid tax surprises and will ensure you always know where your business is standing and where it's going.
Follow these five tips to help increase your efficiency and organization - and hopefully relieve a bit of stress, too.
We advise simplifying your wallet to only one business credit card and using only one business bank account. Doing this reduces the complexity and time spent on bookkeeping and bank reconciliation functions. Plus, if you ever choose to outsource your bookkeeping or accounting, this may result in a lower service fee.
Bookkeeping software has come a long way over the past decade, and some programs make it much simpler to input expenses and monitor cash flow.
QuickBooks is a popular option for many small businesses, and the cloud-based capabilities make it easy to access or share important financial information without heading into the office. Xero is another software that we recommend - and when you work with CSI, we cover the Xero subscription fee for you.
If your business has a lot of financial activity, it can be easy to lose track of expenses. You should track every receipt, invoice, and cash used to pay for business expenses.
When your business first started, it may have been fine to keep your finances in the same place. However, we advise separating your business and personal finances, especially if your business is growing. Nothing triggers a government audit faster than commingling funds.
When you need to move money between personal and business accounts, consult an accountant first to learn the most tax advantageous ways to do so.
Payroll is only a portion of your records, but it's important! Once your business has enough activity that running payroll takes up time, energy, and effort that you can't prioritize over other aspects of running your business, it's time to hire a payroll service.
A good, reputable payroll service provider will do these in an accurate and timely manner:
If you've been facing those pesky IRS penalty notices, a payroll service will stop them.
If you're doing your own bookkeeping, we suggest obtaining all of the knowledge and supplies you'll need before even opening your doors. Then, establish a weekly routine of documenting all income and expenses on a specific day, turning it into a long-term habit. Don’t let months pass by without tracking expenses. Being proactive means you'll have fewer obstacles to tackle in the long run.
However, at the end of the day, bookkeeping is largely just managing your records. Plus, most small business owners end up outsourcing their taxes with an annual tax preparer during tax season. These are just the basics, whereas monthly accounting brings bookkeeping and tax filing together, but it also includes:
When you outsource all of the items above with one service, you have time to do what you do best: manage and grow your business.
A firm like CSI Accounting & Payroll can combine bookkeeping tips number four and five, conveniently and efficiently handling all of these services under one roof. You'll even get a discount for bundling accounting and payroll services!
In turn, you’ll be able to focus more on providing the best possible service for your clients. Don’t wait for mistakes to happen or opportunities to pass you by; outsource so you can concentrate on your bottom line.
Want to find out if CSI can be a good fit for your business? Click the button below for a free consultation. We would love to talk with you!
If you want to learn more about the benefits of monthly accounting, click the image below to read about the different types of advice that a monthly accountant can provide - all based on your books, financial statements, and conversations.