Running your own business, whatever industry you are in, is time consuming and sometimes exhausting.
We understand this and we also know how keeping your books and records up to date and in order can seem like an overwhelming task.
We have therefore put together some bookkeeping tips we think will help you to keep on top of your financial records. Following these simple steps will save you time and allow you to focus on your business rather than sorting your paperwork.
1. Keep the following documents in your accounting records:
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- Bank statements
- Supplier invoices
- Customer invoices
- Supplier statements
- Business credit card statements and receipts
- Business expenses
- Business Mileage
2. Keep business bank accounts and credit cards separate from personal accounts and cards.
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- All business purchases should be made through your business bank account or on your business credit card.
3. Use an accounting software app to record all your transactions.
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- By linking an app to your business bank accounts and cards, the software will automatically log all transactions, so there’s no need to maintain a spreadsheet or written records.
- Speak to your accountant, who will advise which app to use. You can take a look at QuickBooks, Sage and Xero who are the big 3 players in the UK and they supply software that helps keep all your bookkeeping organised.
4. Keep up with tax deadlines.
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- Failure to pay taxes on time to HMRC will incur a penalty, so always ensure your bookkeeping is up to date.
- Your accountant will let you know the deadlines and paperwork requirements.
5. Keep on top of customer payments.
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- Speak to your accountant regarding best practices for pursuing unpaid invoices. (Payment terms, late payment fees etc.)
- Set clear payment terms. For example, nett 15 or 30 days.
6. Keep on top of supplier payments.
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- Having payment terms in place means you will know when to expect funds to leave your business accounts, making expense tracking much easier.
7. Update profit and loss (P&L) statements regularly.
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- Creating a P&L statement, and updating and comparing it quarterly, will show you how close your company is to meeting its financial goals and enables changes to be made, if necessary.
8. Watch your cashflow…. always.
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- Knowing your cashflow is essential to the survival of your business. Lack of cash kills a business so always have visibility on this and speak to your Accountant who will advise how to do this.
Finally, if you need any further advice on bookkeeping or would like to speak to us about G W Dick & Co doing your bookkeeping for you then please contact us.