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the book keepers

Author: Armani Mcclure

5 Tips for Brilliant Bookkeeping

Whether it’s your goal to grow a thriving business, it’s essential to truly have a safe pair of hands handling the accounts. Inaccurate bookkeeping could harm your business and may also lead to severe penalties – but having strong financial statements can save you in many various ways.

The bookkeeper’s job is to keep rigorous accounts of all financial transactions – everything the business sells, buys, owes and is owed. This is vital, and not just because you need accurate annual financial statements. Good bookkeeping can also assistance with a lot more exciting, forward-planning side of things – because knowing days gone by makes it much easier to predict the near future.

Here are some of the main element things a good bookkeeper should do.

Keep the business and personal finances apart

If you are a sole trader you aren’t legally obliged to have a separate business bank account – but you should have one nevertheless. Otherwise your books will be a nightmare to keep, if you don’t record every penny of personal spending too.

If your business is a restricted company, it is another legal entity from you, so its money is not yours to spend (except on business expenses).

Keep clear and separate records

Bookkeeping typically requires at least three ‘books’ (i.e. financial records): the cash book, sales invoices, and buy invoices.

Your money book records everything passing in and from the business’s bank-account. This record of cash flow makes it an invaluable planning tool, as you can make use of it to underpin forecasts.

Your sales invoice file keeps an archive of all of your sales. Keep unpaid invoices together in a separate section. Your purchase invoice file should record all purchases chronologically, see more at this site: bookkeeperco.com.au.

Control your credit

A full sales ledger is a lovely thing, but if your customers haven’t paid yet, that beauty is merely skin-deep. Set strict deadlines for your customers to pay their bills for you, and consider blacklisting repeat offenders if you believe they are really taking advantage. Chase every late payment, as each is actually an interest-free loan. Without rigorous credit control, a tiny business can quickly develop a cash-flow crisis. 

Track expenses

Business expenses can be claimed against tax, so tracking them is vital for cutting overheard and maintaining healthy cash flow. Use a business bank card where possible and keep careful records of all other expenses, categorizing them by business activity.

The bookkeeper will categorize of expenses can prove especially important if your business happens to be audited. Numbers on tax returns are frequently estimates so it really helps to have the ability to provide supporting evidence for these.

Plan ahead

One of the better reasons to keep track of where you’ve been is the fact it helps you work out where you’re going. Looking at days gone by year’s books, you can usually spot the days when a bit more forward planning could have saved you money and stress.

Identify the major expenses of the year ahead and fix them in your business plan. Anticipate likely business costs (e.g. insurance costs or IT upgrades) but always give priority to your tax obligations – you will not have the ability to delay these. There could be occasions when your business seems awash with cash, and you could be tempted to obtain more than usual – having a complete roadmap of future expenses will warn you to be careful.

A bookkeeper can care for your bookkeeping as well as providing an array of other valuable services for your business. Seek out one locally using our smart search. Read more.

 

 

 

The Eight Most Common Bookkeeping Mistakes

INTRODUCTION

When you hear bookkeeping, it sounds like a very easy exercise. Get the numbers and put them in the right place. And it can be so easy, so long you get the puzzles correctly, and they cut rightly. Here are the top eight mistakes that companies have suffered from accuracy, completeness, and security and how to avoid them.

Failure to track petty cash

Many companies see petty cash as s fund for various expenses that really are too little to care about. Who cares about $2 to buy a new pack of staples or $10 you can give to the cleaner after tidying? Eventually, if the annual cash cost of initiating a small addition of hundreds of dollars, the ATO will Fill out petty cash receipt so your bookkeeping can follow up with every expense.

Not saving small receipts – No matter what the payment method, all receipts need to be saved or a note of the expense made in a diary. As many businesses fail to do this with small invoices as with petty cash. All those small expenses add up – to save all of your receipts.

Not tracking reimbursable expenses

Yes, all of the top three bookkeeping sins are related to failing to keep records! You should collate and submit for reimbursement any expenses paid for out of your pocket at least once a month to help prevent things being ‘lost’. To assist record keeping, you could try to make payment of all reimbursable expenses from a separate credit card (used purely for business) – that way you can identify any missing receipts from monthly credit card statement. See more.

Not reconciling books to bank statements

Any small error in bookkeeping can quickly grow out of proportion, as new calculations are based on old figures and balances. Reconciling your books to bank statement will be done automatically by the bookkeeping services; if you’re handling your own accounts, make sure you also do it.

Failing to keep a paper trail

Try to keep documentation for every step of any transaction. Any place you see a receipt slip, fill it out and take it away. If there’s an option to keep a carbon copy, do so. If you have more than one bank a/c (i.e. credit cards and cheque account).

Not backing up your company file

Most bookkeeping services will back up your company’s electronic bookkeeping records at every visit. However, if you do an entry yourself, you’ll also need to ensure you do this.

‘Abstract’ or ‘artistic’ accounting methods!

Issuing cheques out of order using creative rather than logical invoice numbering sequences writing some things down and recording others on the computer all of these eventually doom your bookkeeping to becoming completely indecipherable.

Not properly classifying employees

To the ATO, it makes a big difference whether you are paying an employee, a consultant or a contractor. It will also be central to accurate bookkeeping, so ensure you know the difference, and you agree with your payee as to their classification.

CONCLUSION

A lot of new business owners fail to understand the value of their time and think they can squeeze in the bookkeeping tasks between the many other tasks they have. This shortchanges the company and eats up a lot of time, particularly for those who are not familiar with today’s accounting software. For more information visit: http://bookkeeperco.com.au/payrollservices/

 

 

Learn How to be a Bookkeeper

How do you feel about accounting and bookkeeping? You will either be all for it or running from it. If you are the latter, keep on running however, if you would like to know the backbone of what runs your business than read on and learn. All businesses, regardless of what kind of operation you got going will run on some type of bookkeeping. Accounting and bookkeeping are essentially in order to ensure that the funds are available to run the business.If you don’t know anything about bookkeeping don’t fret. According to an article, you can learn bookkeeping at home through the mail and or the internet. With internet and or mail order courses, you can get the accreditation or certification that you need to become your own bookkeeper and even change others for your service. Learning bookkeeping is obtainable and could assist you greatly in your own business. As a bonus, if you can become good at bookkeeping than you could do it freelance as well giving you yet another stream of potential income.

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