Want to stay on top of your business’s money? We’ve got you covered! Read on for some essential small business accounting tips!
Is keeping the books for your business keeping you up at night? You aren’t alone.
Reports show that 60% of small business owners feel like they don’t know much about keeping the finances of their business straight. The good news is that there are a few simple tips to follow that will make your life easier.
If you’re trying to get the cash flow of your business under control, this post will help. Follow the five small business accounting tips below to start taking control of your money.
Create a Business Bank Account
It’s tempting to handle all your business finances with a personal bank account when you first start a business. While this is easier in the beginning, it can cause headaches in the future.
You need a way to separate your business and personal expenses. Make sure you have a separate bank account to keep your personal and business finances apart.
Having good data is vital if you want to stay financially healthy. It’s easy to lose track of things if you look at the information once and toss it aside.
Create backups of all your statements, receipts, invoices, and other financial documents. They should be readily available in case you ever need them in the future.
Keep Track of Your Invoices
Not all your customers are going to pay you straight away. You’ll need to invoice them and set a due date for them to pay by. Unfortunately, not everyone will pay you on time.
Regularly check all your outstanding invoices to find overdue customers. You need to reach out to these people to figure out what’s going on and try to get them to pay.
Review Every Purchase
It doesn’t take much to let spending get out of control. This is especially true for smaller items. It’s easy to let a few dollars slip by now and again.
If you let this happen too much, your small purchases can end up accounting for a large amount of your budget. Evaluate every purchase you make beforehand to make sure it’s something your business actually needs.
Automate Everything You Can
It doesn’t take much to make a simple typing error. Even the best typist has it happen on occasion. You can’t afford to let this happen when recording financial data.
Automate as much of your financial workflow as you can. You can make use of online accounting packages like Quickbooks Enterprise 2019 to document your business transactions. It will connect to your bank account and categorize your financial data for you.
Put the Small Business Accounting Tips Above in Place Today
Your business finances are one thing you can’t get wrong. Even the best accountants can make mistakes at times. Make sure to take advantage of the small business accounting tips above so that you can keep your finances under control.
If you have your finances under control, you can start focusing on expanding your business. Head back to our business section to learn the tips you need to make use of your cash flow.
See also: 2020 Business Owner Mindset Report