The task of tracking all the financial activity of a company and keeping a proper record of it is crucial. Moreover, when the company grows and the tax time comes near, you will feel a bit lost if bookkeeping is not done correctly. You can hire accounting services such as Xero bookkeeper Adelaide to keep the accounting automated.
Bookkeeping is essential for every business to succeed. It will help you in managing the plans, operations, finances, and much more. To keep moving your company in the right direction, here are a few accounting tips that can be beneficial.
#1 Maintain proper financial records from the beginning
It might sound easy to say, but keeping a good financial record even at the most basic level is crucial. But what are good financial records? The records which can provide all the necessary details regarding the movement of finances in and out of business is considered as good records. With the help of a Xero bookkeeper Adelaide, you can be aware of the income, where it went and what it was for. Even the smallest of the amounts will be tracked and noted.
No matter if you enter the records manually, or use spreadsheets, or use cloud-based accounting software, maintain consistency at all times.
#2 Get receipts for everything
For most of the small businesses, a lot of transactions are done using cash daily. Therefore, it is easy to lose track of such small expenses which can quickly pile up to become a considerable sum towards the end. So, make sure you have a receipt for every product or service that you purchase. You can keep the receipts as a hard copy, or you can keep them digitally. However, make sure that they are in a logical order so that you can find any receipt at any time.
#3 Separate business and personal expenses
As soon as you start any business, try to get a separate bank account for the company and personal expenses. Even if you are putting any capital to your business account, make sure you have that adequately documented. Xero bookkeeper Adelaide can help in properly managing the company’s expenses and keeping them separate from the personal expenditure. Moreover, one cannot deduct personal expenses on a business tax return. There can be high penalties in such cases. Therefore, make sure that all your personal expenses are separate from the business expenditure.
#4 Save your time by grouping invoices
Especially in a small business where there are a lot of small purchases on a daily basis, there will be a lot of papers. More often than not, it becomes a challenging task for business owners to keep the books themselves. Therefore, to keep everything in order, get a Xero bookkeeper Adelaide. This will help you in saving time and money. Moreover, everything will be sorted and in the right place. All the transactions will be adequately explained and categorized. Try to have all your invoices grouped by the nature of the type of expense to keep it organized.
#5 Keep the tax money aside
Until and unless the company’s income is minimal, there will be taxes to pay at the end of every financial year. Figuring out the amount that you need to pay as taxes can be difficult and time-consuming. That is where a Xero bookkeeper Adelaide can come in handy. Your bookkeeper can keep you updated with the amount that you need to pay for taxes on a regular basis. This will help you in keeping that amount on the side and not getting into trouble later.
#6 Automate the accounting practices
Accounting software can be an excellent tool for companies who want to keep their process automated and mistake-free. You can use the software by yourself or hire Xero bookkeeper Adelaide. The software will track the income accurately, and all the expenditures and invoices will be categorized to generate proper and timely reports. By automating your business, you will remain a step ahead at all times.
#7 Take out time to update the books
First of all, make sure that if you are the owner of the company, you don’t end up keeping the books as well. You have plenty of other crucial tasks to look after and spending all your time in bookkeeping will simply be a waste of your efforts. Therefore, hire a professional Xero bookkeeper Adelaide who will do that for you and your company. However, make sure you block out time every week to go through the books properly. This will help in avoiding last minute pile up, and you will be able to have complete knowledge about the process.
#8 Keep tabs on the labour costs
Around 70% of the business’s total budget is used for paying the staff and yourself. Therefore, to have a proper track of the same, there should be proper notes regarding bonuses, overtime, perks, and various other benefits. Your bookkeeper can also help you in managing the payroll efficiently with proper deadlines.
#9 Expect major expenses
When you are running a company, it can’t always be smooth sailing. At any point in time, without any prior information, there can be computer upgrades, replacement of equipment, tax deadlines, and much more. These unexpected expenses can cause major trouble for the company if there isn’t any backup or funds at hand. So, as a company owner, you should always expect major expenses. Make sure you stay in touch with your Xero bookkeeper Adelaide regularly to be aware of the expenses of the company.
Accounting and bookkeeping is a crucial part of every company. However, hiring a professional Xero bookkeeper Adelaide can help in directing the company towards growth. There are bookkeeping service providers such as AQ Bookkeeping that provides reliable and professional bookkeeping services. You can also get the right training from AQ Bookkeeping to get someone to handle the books in your business. Make sure you are always a step ahead when it comes to effective and efficient handling of the finances with Xero bookkeeper Adelaide.