Bookkeeping For SMEs: Tips For Keeping Your Books In Order

• Book keeping
• April 7, 2022

Starting a business requires passion, dedication and the need to satisfy personal needs or the needs of an identified target market. It can be exhilarating and exciting and many people focus on that part. However, most people find out a little too late that owning your business means being accountable and having to keep track of every single aspect of the business. It isn’t fun but it is extremely necessary to ensure that the business is monitored to ensure continuity.

Although it is really tedious for business owners without the skill and knack for it, there are immense benefits to keeping your records in order. The most obvious benefit is that you are able to keep track of the state of your business finances and cash flow, to be able to determine what immediate and long-term changes to make. By keeping a constant watch on your books, you will be able to maintain a healthy cash flow within your business and spot cash flow trends as they occur. In spotting trends, you are able to stay one step ahead of the trends and work with them to leverage your revenue.

5 Foolproof Bookkeeping Tips

Collate your financial records appropriately

In every business, it is of utmost importance to ensure that extensive records are kept to ensure accuracy and monitoring of the business flow. Even though all businesses are different, there are basic records and documents that they all need. All businesses need to have at least the following records

• Invoice records
• Purchase files
• Expense Receipts
• Outstanding payment records
• Salaries and staff expenses
• Overhead cost records

Keep Your Personal And Work Accounts Separate

As a CEO or business owner, there is usually a fine line between business and personal finances. It is extremely important to ensure that you keep both accounts separate. Even if you’re the sole owner of a business and have no stakeholders, it is important to remember that the money is meant to be used only for business. You should not “quickly borrow” out of the business to fund personal needs.

Try To Balance Your Accounts At Regular Intervals

Leaving your bookkeeping until the last possible minute will only lead to an increased chance of mistakes happening. As a business owner, it is important to carve out time to balance your books regularly so that you can keep proper tabs on the state of finances, and make adjustments appropriately. The less time you have between periods where you balance your books, the easier it is for you to balance the books.

Keep A Close Eye On Expense Receipts

It is crucial that as a small business owner, you ensure that every expense is logged. Because of the relative instability of a small business, there is a higher possibility of sudden payments and costs due for several reasons. It is important not to let any of these expenses slip because they might end up affecting your bottom line or being overlooked during tax calculations, which are both detrimental to the business.

Use A Professional For Your Payroll And Tax

The importance of this cannot be overstressed. While you may think you’re a relatively small business so doing your payroll and taxes can’t be that difficult, there is every likelihood that you’d end up making mistakes because you’re not a professional in the field. Using a payroll management system like Eazipay allows you to conduct payroll activities in a fraction of the time it would normally take, so you can dedicate your time to more constructive things. Trust us, when it comes to payroll management in Nigeria, Eazipay is the solution for all your payroll challenges!