Posts Tagged ‘Bookkeeping’
Dos And Don’ts Of Small Business Bookkeeping
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If you are a small businesses owner and looking to optimize your operations, this list of do’s and don’ts on bookkeeping will help you save valuable time and money.
Let’s look at the DON’Ts first and rectify them now:
Insisting to do it on your own
Most small business owners and start-ups make this common mistake of maintaining the books of accounts all by themselves. Unless their core expertise is accounting, most entrepreneurs procrastinate this task and end up with a huge backlog at the end of each month. The motive to do it yourself may rightly be to have control over the way finances are managed and to avoid misappropriation, but remember, all these come at the expense of deviating your focus from core revenue generating business activities and losing valuable time, (it is estimated that average businesses spend around 20% of their time on bookkeeping). So, why lose out when you have better options like hiring a dedicated bookkeeper, automating, or outsourcing it.
All-in-one accounting
Most small businesses get into this habit of not categorizing incomes and expenditures and end-up maintaining just one book for journal entries. This will lead to lack of clarity as to which business activity is turning out to be an overhead. For instance, if you are maintaining a separate ledger for bills receivable and you are regularly fighting bad debts then it shows inefficiency in your collection process.
Not recording small expenses
Many petty expenses goes unnoticed or unrecorded, as we believe it makes no impact or the IRS is not bothered. These petty expenses over a period in time will pile up and create a big hole when you balance your accounts, these receipts if maintained may prove to be crucial while paying your taxes.
Just maintaining an Excel sheet
Start-ups and even small businesses feed all their entries in an Excel workbook as it makes things easier and avoids paper. But remember as your business grows so will this Excel sheet until it becomes an unmanageable monster.
DOs- things to do right now:
Reconcile with your bank account
Miss this practice to find glaring differences when you finally tally your cash and bank books. This practice has to be followed every month or at least every quarter to avoid discrepancies that may prove fatal.
Maintain backup
Use web based accounting applications that take care of your data backup. Not only can you access the system from anywhere, but also the system automatically takes care of data backup.
Generate reports
One vital role of bookkeeping is to track our business growth, but we seldom look at it that way. Bookkeeping should finally help us track our set financial objectives and correct us if we are going off-track. This is where financial reports come in handy.
Use of software
This needs no introduction; most widely used accounting software QuickBooks is so efficient and reliable that it outsmarts a professional bookkeeper on all counts. It saves your time, money, generates all the financial reports needed for tracking your growth, and also comes with a plethora of features like, easy payroll system, imports your Excel reports, seamlessly integrates with your Microsoft Outlook, customer credit card protection, EDI, supports Linux and much more. Phew…that’s a lot of stuff.
Outsourcing
This is where the buzz is around; no one needs to be educated on the unavoidable benefits of outsourcing. Remember most small business owners are not professional bookkeepers and trying to be one is just wasting time, money, and resources. Outsourcing makes it easier, strictly professional and above all gives you the luxury of focusing on your core business activities. It is always wiser to rely on expert bookkeepers rather than being unprofessional with bookkeeping. You can outsource as little as an hour of bookkeeping work per day.
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Small Business Bookkeeping Soft ware and Tips
Any financial accounting or bookkeeping software will perform the core accounting functions related to general ledger, accounts receivables, accounts payables and other cash functions. But often the business owner wants and needs more, depending on the industry he is in. So, the best investment one can make while picking bookkeeping soft wares is to define, in the first place, all your needs and demands. You will also be able to keep up with the relevant financial information at any time. Small business bookkeeping software is designed in such a way that it is a powerful tool that helps you watch your payroll so that you will get the payrolls done quickly in addition to job cost records. Move up from a manual system of doing the bookkeeping all by yourself and have it done outside. Sometimes you might be looking to set up a bookkeeping business yourself. In any of the cases mentioned above, financial bookkeeping software you choose can help your business grow vertically. You should know some tips for choosing one wisely, but you should know what you want. Spend enough time to define your demands and requirements.
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The price is usually more than what it costs and this tells that “free” software is not actually a free one. Learning a soft ware can result in a bigger cost in terms of time and effort than the initial expenses or cost incurred to buy it. Do not overlook the training costs if you have financial accounting and bookkeeping staff. If you pick the wrong software you may have to go through all that again with more difficulty. You are going to need some help to learn the accounting software and you are likely to need on-going support also. Now hopefully, somebody must work through whatever problems that can arise. Often times, local accounting firms have experts that work on some of the major software products. Plan ahead well in order to tackle unforeseen problems that may arise in between.
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As your business keeps growing, you may need more of an accounting and financial bookkeeping power. Choose good brands of financial software; you can very well upgrade to more powerful and efficient ones smoothly. If you intend to switch bookkeeping soft wares, you will have to pay for the start-up training costs all over again. Consider different options and see whether you can upgrade so that you can make the most of what you have. Generating tax compliance forms and other government and income related documents is one of the main goals of a bookkeeping software package. This simply means you can stay out of trouble. These accounting soft wares are more powerful than anything else, and they will help you stay out of trouble. The right and apt software can help you produce or generate financial reports that help you make wise and informed decisions. Better and valid information can lead to more sales, profits and a better control over different cost factors. Bookkeeping software can be said to be a powerful tool for managing a business.
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How to Choose the Right Bookkeeping Software for Your Small Business
When conducting your search for the perfect bookkeeping software, be sure that you look at options that will grow with your company. Software conversions can be costly and time consuming, so you want to find the perfect software that fits current and future bookkeeping needs.  Be sure that the bookkeeping software will answer all aspects of your business needs, including invoicing, payroll, accounts receivable, accounts payable, budgeting and tax preparation – and provide cohesive reporting tools for each area. You should be able to see where you are financially at any time. Your bookkeeping software should help you reduce liability in the areas of payroll administration and tax preparation.  There’s plenty of bookkeeping software available on the market. Here are a few more suggestions that should be beneficial in your decision making process:  Review bookkeeping software first by function. Be sure the software includes general ledger, accounts payable, accounts receivable, sales order entry, inventory control, job cost, purchase order, report writing, order process, fixed assets and payroll functions.  Second, review bookkeeping software by product type. Will a small business payroll and bookkeeping software fit your needs, or would you be more comfortable with a web-hosted bookkeeping application?  Next, review bookkeeping software by price. There are a few “free” programs available that can create invoices, print checks, handle payroll and manage up to 20 customers. But chances are, they won’t grow with your small business. Higher-priced, full-featured bookkeeping systems also include other financial functions you need to track your business, such as point of sale, inventory control, customer relationship management (CRM), billing, purchasing and even enterprise resource management (ERP).  Don’t forget to consult with your bookkeeper and staff. It’s wise to consult with an expert, and your bookkeeper or accountant may be able to recommend software that works with best with your current system. Also, involve your IT consultant to be sure your current hardware will work with your new bookkeeping software package.  Automating your bookkeeping function will help you save time and money, as well as assisting in important planning and compliance for your small business. Prioritize your needs and make sure the software you choose meets most, if not all, of the features that are important to you.
What’s the best software for opening a bookkeeping business?
I am in the process of starting a bookkeeping business and am having trouble deciding what I want to do about software. The companies that I’ll be doing the bookkeeping for will be rather small, and won’t have much need for anything more than a basic bookkeeping software with maybe the capability to do payroll. Some of these small businesses will have attempted to do the bookkeeping on their own but have for some reason decided to outsource. Since they may have tried to do the bookkeeping, they may have purchased software to use such as Quickbooks, Peachtree, Quicken, etc. There’s no way for me to predict what software they will have and I’m trying not to buy each version just so that I can transfer files. I would much rather use Quickbooks for all of my clients. Now, I don’t need Quickbooks’ Accountant software because my clients will not also be using the software, only I will. If I buy one of the basic versions of Quickbooks like I mentioned before, can I just have it set up to where I’ll have numerous company files. I’d create a new company each time I take on a new client and input the bookkeeping information they may have from before manually. I know you can create more than one company file in Quickbooks, but I don’t know if there’s a limit on how many you can create. So can I actually have those numerous company files, plus my own for keeping the books of my business, in that one program? If so, does anyone know how many companies you can create a file for in Quickbooks (or Peachtree, Quicken, etc.) without having to purchase a license for multiple users. And if not, does anyone have suggestions on what I can do.
I have a degree in Accounting and about 6 years of experience doing bookkeeping (4 years in Quickbooks) so I do know what I’m doing but with each previous employer, they only had their one company file created and I never looked to see how many companies you could actually create.
Thanks for taking the time to read my question; any and all suggestions will be very much appreciated.
-Taylor
Small Business Bookkeeping Software — 7 Easy Steps to Get the Best Solution
Get the right small business bookkeeping software and you will save time, money and stress. Now up to a point a manual bookkeeping system is all you need. One good manual system is the Dome Simplified Monthly Bookkeeping Record. You can pick this up at Office Depot or Office Max. That will even work OK with a couple of employees. But if you’re ready to step up to a computer system, you face a flood of products to pick from. Following are 7 tips to help you choose the best bookkeeping system for your small business.
Tip 1: Decide what you want.
If you’re upgrading from a manual system or switching from a bookkeeping service, there must be a reason. Decide what you want from a bookkeeping system and you’re more likely to get what you need. The best system should save you money.
Tip 2: Free might work.
A free system might work. Microsoft offers a free version that’s limited, but may be good enough. Usually if you have any employees a free system isn’t for you. But if you don’t have employees, consider the Microsoft free option.
Tip 3: Simple will work.
Buy more system than you need and you’ll pay hidden costs. Learning any system and using it is part of the continuing cost of software. An overly complex system will cost you as long as you try to use it. Simple is good if that’s what you need.
Tip 4: Software in a box.
Look at the major accounting software suppliers like QuickBooks and Peachtree. They sell software in huge volumes and there are thousands of users who have gone before you. No need to be a pioneer.
Tip 5: Easy upgrades.
Cheap software may be a dead end. If you ever need to upgrade, is there an upgrade version or do you get to start all over with a new software vendor? Maybe you can’t even easily transfer your records to the new software. Oh my!
Tip 6: Online for less stress.
Online software may be an option. Especially for payroll, you can forget about keeping up with endless regulation changes and just let the software people worry about that. Lots of bookkeeping automation is available really cheap with online accounting software.
Tip 7: Who can you call?
What happens when you have problems? Who can you call? Software has been known to just lock up and there you are. So know who can help you if you get in trouble, because trouble will come with any software.
The right small business book keeping software makes running a business easier and less stressful. The problem in choosing the best software is you have so many choices. Think through what your real needs are before you buy anything. Pick overly complex software and you’ll pay too high a price in learning and using the programs. But on the other hand, buy too little system and you may find yourself stuck and forced to learn a whole new system. The good news is that you have several options from major companies that are already used by thousands. You can easily buy a proven product that will do the job.
Get more tips to make the best small business financial software choice by visiting http://AccountingSoftwareTrends.com .
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