Bookkeeping refers to the maintenance of documents that record a company or individual’s financial transactions. Anybody can engage in bookkeeping, which in its most basic form merely consists of writing down the values of financial transactions. Certified accountants are generally given responsibility for maintaining the financial documents of large companies. If you are in need of qualified, professional assistance with your books, NumberSquad is here to help. In the following, you’ll find seven tips on how to do bookkeeping.
1. Set Aside Money in your Budget for Tax Purpose
One important thing to remember is that your government compels its subjects to pay money to it, often on an annual basis. These payments are called “taxes”, and you and your company will pay them, voluntarily or otherwise. For this reason, you should earmark some of your annual income to be paid as taxes.
2. Organize Your Documents
An initial step in the bookkeeping process is to organize your documents. This will help you to be sure that all relevant information is included in your accounts, and will also save you time.
3. Keep Track of Your Expenses
Of course, including all relevant information in your financial records means that you will need to document your expenditures and outlays. If you don’t have a record of payment, it’s unlikely that you will remember to include it when it comes time to bookkeep.
4. Keep Daily Records
One way of being sure to include all relevant information in your financial records is to log all transactions according to various temporal frames of reference, such as the day, week, month, quarter, and year. Of these, the day is perhaps the most important, as it means that your books will be updated on a consistent basis.
5. Maintain an Audit Trail
Also called “audit logs”, audit trails are systems that are used to maintain records of transactions and other kinds of activity on a consistent basis. Systematizing your record-keeping allows for transparency, so that your records may be reliably checked, or “audited”, whether by accounting firms or governments.
6. Maintain Control of Your Accounts Receivable
It’s important to ensure that your customers are paying their bills on time. Some ways of doing this include setting out and communicating clear policies, regularly checking up on customers who owe you money, and employing collections agencies to recoup unpaid bills.
7. Remember Tax Deadlines
Your government imposes deadlines upon its subjects for the payment of taxes. It’s your responsibility to remember to meet these deadlines, or else you will end up paying your rulers a lot more money, which is undesirable.
What is Bookkeeping?
Bookkeeping is the systematic maintenance of financial records. In its simplest form, it involves the documentation of credits and debits. As the role of the state has grown, the state has come to regulate the bookkeeping in which the corporations it creates engage. For this reason, bookkeeping now involves numerous stipulations that are necessary to adhere to. If you need professional assistance with your bookkeeping, the qualified accountants at NumberSquad are always ready to document financial transactions with the utmost rigor and transparency.
Why should I do bookkeeping?
It’s both useful and important to keep track of your financial transactions. Knowing with extreme precision the transactions in which your company has engaged allows you to judge the success of past projects and to plan future ones responsibly. Bookkeeping also allows you to be sure that you have met your financial obligations, and to ensure that your customers meet theirs by paying you what they owe. Your government is another consideration. In order to be sure that you are paying your taxes, the state may send agents to audit your records, legitimated, perhaps exclusively, by the force of arms. In the event that your records are less than transparent, and your connections are not as strong as they might be, you may expect that the state will drop the hammer down upon you and your company.
Who is in Charge of doing Bookkeeping?
Generally speaking, certified public accountants (CPAs) or bookeepers are hired to carry out the bookkeeping requirements of large companies, while the owners of smaller companies may take care of their bookkeeping needs themselves. Although CPA status is determined by a certification process, most CPAs receive the bulk of their training in institutes of higher education. This training qualifies them to use a variety of record-keeping and analytical approaches to bookkeeping. Employing bookkeepers will allow you to benefit from the whole range of possibilities and protections that sound bookkeeping affords. The professional bookkeepers at NumberSquad are here to help with all of your small business bookkeeping needs.
How to do Bookkeeping in Excel?
Microsoft Excel is a common and easily-accessible program with which many people are familiar. Its layout makes it seem like an obvious choice for bookkeeping purposes, yet it is subject to certain limitations. To bookkeep in Excel, find and customize a template. This template should include at least three sections: A chart of accounts, a transactions list, and an income statement. Use this template to record the daily activities of your company. Although it’s possible to use Excel for your bookkeeping purposes, the program is not designed to work automatically. This means that you will not be able to record your transactions with a very high level of specificity and redundancy compared to other programs.
Is Bookkeeping Easy?
No, bookkeeping is not easy. Simply recording transactions might seem easy. Yet bookkeeping and accounting involve a complex set of considerations that are of grave importance for the future of your company. Keeping precise, detailed, transparent, and overlapping accounts of your credits and debits requires discipline. Government regulations and tax legislation impose upon the bookkeeper at times inscrutable, obscure, and esoteric burdens, the contravention of which may have profoundly negative consequences. Finally, the fecundity of advanced financial analysis techniques for your bottom line can only be accessed by means of scrupulous attention to accounting detail.
Is Bookkeeping Software Available?
Yes, bookkeeping software is available. These programs allow for the automatic entry of data into pre-determined categories, increasing both the speed and accuracy of documentation. Intuit QuickBooks Online is considered the best accounting program. Furthermore, NumberSquad’s DocuPort app can be used to integrate the outputs of these programs on a single, easy-to-use platform. Get in touch with NumberSquad today to see how our qualified financial professionals and artisanal computer programs can transform the way you do business.