24 Aug How to Save Money on Bookkeeping?
So, you’ve made the bravest of decisions to fully throw yourself into the enterprise you’ve founded. Now, there are literally so many details that you have to juggle and a gazillion of tasks that need to be handled. But, because you feel quite strongly about what you’re doing, you’ll do whatever it takes to see this through.
It all starts with passion
Why did you get into starting a business in the first place? Perhaps, you had a love for unique cuisine and demand for your culinary masterpieces naturally followed. Maybe, you have an innate talent for creating beautiful interiors or designing fashionable clothes. There was an opportunity to fulfill a need and you found yourself there at the right time and at the right place. Of course, you have to enjoy what you’re doing — or else you’ll feel like you’re being a fool chained to the grind.
Every morning should be taken as an opportunity to be able to do more good for the world. That may seem like a lofty idea, but what you should go beyond the mere menial routine of just flipping burgers. You’re providing a service that people need and they seem more than willing to compensate you for your time and effort. When you throw yourself completely into what you’ve invested your resources in, the success to follow becomes a natural result.
You’ve probably come across the story of a cab driver. His passengers are treated more like a royalty than just your regular day-to-day fare. There’s available reading material for his passengers and some refreshments are conveniently located in the seating area. The secret of this cabbie is that he feels in his heart that he can make the journey more enjoyable for the people who avail of his services.
It’s very important to have that enthusiasm in your heart, but this will all go if your finances are mismanaged. When your expenditures become too unmanageable and this becomes heftier than your income, this only brings about the inevitable breakdown of your business.
But, with some proper bookkeeping support, you’ll have comprehensive data to keep you more in the safer side. You’ll have the information on hand to direct you on which costs to cut back on and where you can bring in more sales. This all requires some bookkeeping expertise and there are ways to acquire this without you drowning in debt.
Keep track of where your money goes
Let’s face it, bookkeeping is necessary for your business to function and perform more efficiently. Failing to monitor what’s coming in and what’s going out will most likely plunge you into an ugly hole of debt. By following these time-saving tips with regard to your bookkeeping, you can contribute more positively to your business:
- Separate your business transactions by using a business bank account and a business credit card. It will get too confusing for your bookkeeper if you co-mingle these activities with your personal expenditures.
- For cash-based activities, your receipts should be organized in the order that it was printed on your bank statement and/or credit card bill.
- The receipts should be filed in the way they were paid. Credit card slips in one folder, bank withdrawals in one envelope, cash purchases in another and so on.
- Try not to use your cash or personal debit cards too much. Paid cash receipts should be placed in a separate envelope.
- Email transfers should be clearly labeled so your bookkeeper can easily differentiate this from the regular bank statement.
- When used or canceled checks are not usually sent back by the bank, your checkbook should list down the disbursements by the date the check was issued. Amounts indicated and the correct description for the expense will greatly assist your bookkeeper’s records.
- Every quarter, submit your paperwork for bookkeeping. This will help schedule submission of reports which can be sorted out more thoroughly.
- Goods and Services Tax not charged to your clients should be indicated clearly. These are probably transactions with government agencies and tax-exempt offices.
Shareholder transfers should be documented accurately. The “cent” system may be an ideal tagging procedure. As a suggestion, assign 77 as your “cent” number. When $1000, for example, gets transferred, automatically tag this as $1000.77. This signals to the bookkeeper that this transaction is personal in nature and you are also reminded of such a status.
Money deposited into your account that is not normally listed as a sale should be known by your bookkeeper straight away. Taxes may be computed on deposits because this will routinely be listed as a sale by the one keeping your books in order.
Mark and clearly identify your business expenses in case you had to apply your personal bank account to settle these bills.
Payroll duties should ideally be monitored by your bookkeeper because there are some rules and guidelines connected to this. Your employees will also be assured that they are being compensated more accurately. There’s software available as well to make payroll disbursements more convenient which your bookkeeper can also look into.
The last thing you want to do is to outsource your bookkeeping needs. Paying peanuts may only result in getting crazier outputs. Besides, by retaining exemplary services and be willing to invest in it, there are savings that can be computed. In the long run, the financial viability of your enterprise is what truly matters. One wrong computation may mean the difference of surviving one more month or unfortunately having to pay a huge fine. When your bookkeeper is happy, that keeps your business in good health as well.