With the pandemic hitting globally and people losing jobs – many are opting for start-ups. But for starting any business, you need good account maintenance. Bookkeeping is challenging. But, with some tips and guidelines, you would sail through without any hurricanes. The tips would help in maintaining the day-to-day accounts and office management successfully.
Business bookkeeping tips with the expert Brian C Jensen
- Maintain personal and business banking separate. On opening a bank account at the start of business, you must not mix it with a personal account. However, a lot of funds go from the private pocket but maintain the discipline of not confusing.
- Transfer the amount from personal to a business account and then proceed with the transactions. Convey the same to the vendors and business partners to follow the same. It will ensure smooth and transparent transactions of business activities. You do not want to confuse personal and business funds at the end of the financial term.
- Brian C Jensen says that business savings accounts are suitable for any business accountancy. It will help in sorting the tax money. You can set a specific amount separately from the business gains to pay the quarterly tax every month. Maintain a record of the statements and allocate around 25% of total income to transfer it to government tax payable.
- Go online with banking. Keep the bookkeeping simple by converting all the payments online. It helps in reducing the bank trips and saves a lot. It is a quicker and easier option for future bank reconciliations. Maintain the payments methods via checks and online transfers. All the records will have white/black statements to avoid any future fraudulence.
- Do not mix your drawings from a business savings account. Whether it’s a sole proprietorship or small business. A good practice to do bulk fund transfers to the company account every month and proceed with the payments and drawings. Give yourself a salary to maintain the disciple of bookkeeping. Even the introduction of capital in the business should not be through the personal account.
- Get a suitable bookkeeping software or application. The change in methods of working technology has also disrupted the financial sector of business. Different types of computer software available helps in managing – cashbook, ledger, inventory, inventory and foreign currency transactions, bank reconciliation, accounts receivable, accounts payable.
- QuickBooks, Xero, Sage, and Wave are some of the latest computerized bookkeeping tools/ software to make your life easy. Invest wisely to make the most of this software as you would be shelling a lot to get the upgrades and first-time installation.
- Go for regular internal and external audits of the business transactions. It helps in getting the projection of the future and improving the past errors.
Whether you maintain the old school method of manual register or go hi-tech with computerized software accounting for your business – keep the records clean and understandable. Maintain the GAAP regulations and file the tax every term. You do not want to end up in confusion and get into administration for poor account maintenance.
