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When you’re starting a business managing the accounts is a vital part of running your own business. Here's some common errors along with some hints and tips on how to avoid them.
At Go-Corporate we can help with all aspects of bookkeeping and accounts preparation. We advise our clients to get a handle on their own bookkeeping so they fully understand their business. We help our clients to choose a bookkeeping system that suits them and get them set up with the software at the start so that the inputting is straightforward. Proper bookkeeping is key to preparing your accounts. At Go-Corporate we have qualified professionals who can prepare your unaudited financial statements and sign off the accountants report which is required for the tax office. Give us a call we’d be delighted to help.
Leaving it too long
Bookkeeping isn’t the most enjoyable of business tasks. There’s always something more fun to do, like marketing, building your network of customers or even just making coffee. But it won’t go away. And the longer you leave it, the harder it becomes to get through all that paperwork.
Set aside an hour a week to do your books so that you always have timely, accurate information about your business’s financial information and cashflow, and so that bookkeeping never becomes too big a task.
Rubbish in, Rubbish out!
Make sure you do your bookkeeping accurately, otherwise you don’t have a hope of having any useful information about your business, and also your accountant’s bill will be much higher because of the extra effort they have to spend to unjumble the mess.
Make sure you’re using a simple, robust system that makes it easy for you to input all of your data accurately and efficiently, and make sure you don’t make any changes in the way you log your figures from month to month. That way your accountant can easily check the figures for any errors.
If you have transactions in your business that repeat regularly, such as a monthly subscriptions, make sure you put these in the same category each time, otherwise when your accountant comes to check that you’ve entered all your costs and claimed the maximum allowable amount for tax, they’ll have to spend extra time finding those costs that have gone into different places - which again means a higher bill for you.
Keep it Simple
There may well be areas of your bookkeeping software that aren’t relevant to your business, for example not every business has to issue invoices. That’s absolutely fine. Don’t waste time by posting entries you don’t need.
You don’t have to post every single transaction manually, either.
Make use of expense management software such as Receipt Bank to photograph your expenses on the move and have them automatically upload into your accounts, saving you the hassle of keeping your receipts.
And why waste time downloading bank statements and uploading them? Check to see if the online accounting system you use has bank feeds available for your bank, as this will allow you to pull your bank data automatically into your accounts.
Bookkeeping will never be the most exciting task in your business, but it doesn’t have to be the worst either!
1) Keep up-to-date with your invoices
Invoices are the secret to getting paid, so it’s important to find the time to invoice every week. It is key to keeping your cash flow healthy and be sure to teach your customers to pay promptly too.
2) Manage your bills
Keep track of the costs you’re incurring and pay your bills promptly to keep good relationships with your suppliers and stay on top of your cash flow.
3) Check your bank transactions
Do you know what you spent your money on in the last week? Or the last month? And do you know which customers haven’t paid you yet?
If you don’t keep track of your bank accounts, you will forget what you bought – and when your accountant asks you ten months later as he/she goes through your bank statements, you don’t stand a chance of remembering what each cost was for. If you use an online accounting system, check whether you can import your bank statement directly into your accounts, which could save you time.
4) Check your projects are earning you enough
Do you know which of your projects/product lines is your most profitable? What’s your best earner, even after all those taxi fares and special delivery postage costs? It can be hard to know if you haven’t recorded all of your costs!
Once you have the full picture, you can make even better decisions about your pricing.
5) Record as you go
How many receipts do you have in your wallet right now, waiting to be forgotten or lost? If you’ve got a smartphone, record that expense as soon as you spend the money, before you can forget about it.
Many online accounting systems are mobile-friendly and integrate with apps that enable you to take a quick snap of your receipt on your smartphone and upload it to your accounts – removing the need to keep your receipts.
If you have any questions or need some advice on any aspects of bookkeeping, accounts preparation or Guernsey tax returns get in contact with the Go-Corporate team. We would be delighted to help.