Why Bookkeeping is Crucial to Your Success
Keeping track of sales, earnings, expenses, and purchases is fundamental to the overall health and sustainability of your business. Effective bookkeeping produces the data you need to evaluate your current practices, anticipate challenges, and set attainable future goals.
But despite their proven importance, many business owners dread and avoid accounting tasks. Many business owners claim that bookkeeping is one the worst parts of running a business!
Wondering if it’s really worth the aggravation?
Here are four reminders of how effective bookkeeping is the cornerstone of small business success.
Keeping track of reimbursable expenses
A reliable system for tracking reimbursable expenses ensures you reap all the benefits you’re entitled to when filing your taxes. Expenditures sorted into categories, such as “food”, “travel”, and “office supplies,” can be catalogued quite simply with online bookkeeping software.
Using a dedicated credit card for business expenses, and updating your records on a monthly basis, will put money back in your pocket come tax time.
Measuring profitability and planning for the future
In order to grow your business, you must be able to track and compare its finances from one year to the next.
In addition to reconciling the books and bank statements every month, effective bookkeeping generates records you can use to gain a comprehensive overview of your business. This data can help you:
- measure year over year profits;
- identify opportunities to cut costs;
- plan for major expenses (such as new office space, equipment, or staff); and
- develop data-based strategies for expansion.
Preparing for tax season
Few things are more stressful for business owners than scrambling to get poorly maintained financial records ready for tax season. In addition to the panic of last-minute filing, inaccurate or incomplete documentation can lead to serious penalties, fines, and even an audit.
All of these put extra and avoidable financial strain on businesses.
Save money and get peace of mind with sound bookkeeping. You’ll be assured of compliance with regulations, and will receive a reliable estimate of amounts owing long before your tax bill is due.
Final tip: ask for help
Most entrepreneurs are passionate about developing new business ideas – not crunching numbers. Employing a professional bookkeeper, even on a part-time or as-needed basis, can help optimize your accounting and increase overall profitability.
One area that often lacks attention is the bookkeeping, meaning bank transactions are unreconciled, returns are lodged late, payments are not made on time and debtors are out of control.
This would leave any business owner feeling anxious with little understanding of how the business is really performing.
It’s well worth investing in effective bookkeeping with Mukiwa and you’ll build a solid foundation for a resilient, forward-moving small business.
Our aim is to take this pain away for our clients, thereby freeing up their time to work on the business or spend more quality time with the family. Our team of bookkeepers and accountants are 100% Certified 100% of the time and can help you manage tasks like payroll, daily bookkeeping, BAS returns and accounts receivable. Located in Sydney’s Northern Beaches but fully cloud based we can assist you no matter where you are.
Your Time Back …. Or Your Money Back
We can free up your work day to focus on more important aspects of your business. Contact us today for a free, no obligation first consultation. We will even shout the first coffee.