- Bookkeeping can often be overlooked by small business owners
- Find out why it's important to have a strong bookkeeping process
- Follow the steps below to ensure your business is set up for success
I remember seeing a crack in a wall and quickly thought that just patching it up would fix it quickly and well.
Then a builder explained to me that fixing a crack in a wall is not that simple.
A crack in the wall usually relates to a break in the foundation of the building.
If the foundation was not done well, it will lead to other problems with the building such as cracks in the wall.
A building needs a strong foundation to weather all the wear and tear that comes especially with changing seasons.
Your business needs a strong foundation to weather all the vicissitudes of being a business.
The strong foundation of your business ....all starts with strong solid bookkeeping.
Why is it important to have a strong bookkeeping process?
Having strong solid bookkeeping will:
- Position you not to overpay on taxes
- Position you to be profitable
- Position you to have positive cashflow
- Position your company to grow
- Position you to have correct information to make decisions
- Position you to minimize fraud
- Position you to find money leaks
What exactly is bookkeeping?
Bookkeeping refers to the recording of transactions of your business. Bookkeeping is a part of the Accounting Process.
How To Create A Solid Bookkeeping Process
Ensure you have solid processes and systems- also known as order in your business ..no chaos. There should be systems and processes to minimize transactions not being recorded or transactions being recorded incorrectly. For example a dollar ($1) of missing expenses can lead to you paying fifty cents (50 cents) more in taxes.
Bookkeeping should be done by competent persons who understand the ins and outs of your business. This will ensure you have your reporting accurately and well as taxes paid timely and accurately in addition to other key pillars of bookkeeping.
Your bookkeeping process should have at least a monthly review process. The work of your bookkeeper should be checked monthly to ensure transactions are recorded properly. This review process will also provide insights and direction for your business allowing you to be innovative and proactive with strategy and decision making.
As your business changes your bookkeeping processes and systems will need to change as well. This may include using more relevant automation or software as needed as well.
Storage of your records is an important part of bookkeeping. There are different legal requirements for length of storage time depending on where your business is operating. Ensure your bookkeeping process involves an effective storage system.
You never want the building of your home to collapse due to a weak foundation!!
You never want your business to collapse or go bankrupt due to weak bookkeeping.
Where do you need to change the trajectory of your business when it comes bookkeeping?
How To Optimise Your Bookkeeping Process
- Have a quick review of your bookkeeping process as soon as possible. (This is best done by someone external).
- Implement needed changes quickly.
- Ensure your various team members are clear about their roles in the bookkeeping processes.
- Have ongoing frequent reviews on the state and impact of your bookeping department
- Commit to continuously improving the state of your bookkeeping department and processes.
When business owners find their businesses in financial chaos and are serious to take the leap to say hello to cashflow and MORE, they reach out to Kirsha Campbell “The Cashflow Maven”. A CPA/CMA, Kirsha integrates all the moving parts in your business to set up the right foundation to be recession proof, operate with reduced risk, increase cashflow, set up effective systems and procedures and so much more. Kirsha helps business owners to say goodbye to overwhelm, stress and frustration about their businesses results and operation. Kirsha values continuous improvement and is sought after for her attention to details, integrity and her passion to turn businesses around. Having spent years in the corporate world, she understands key strategies that need to be adhered to ensure businesses are successful and set up to be recession proof. She also understands the need for businesses to have customized strategies that fit their particular situation. She is deeply passionate about helping her clients and is committed to forming lasting relationships. She has a heart for her clients and is deeply committed to their businesses being set up for success and be their “go-to” second brain for their business. She expertly steps into each relationship with her clients and is committed to create change and effective solutions in businesses recognizing the importance of looking beyond the numbers. She enjoys partnering with others and implementing customized solutions as needed. She has mentored several persons in her lifetime channeling them to discover their best selves. Volunteering and society involvement are very important to her and wherever she resides she gets involved in the community. She enjoys outdoor living and learning from each adventure and experience from her awesome twin boys!!. Her boys have challenged her to pour into other lives and encourage others with their daily struggles.
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