8 ways for startups to maintain their accounts in good shape.by Devis0426 Parker Writer
Most new business owners don’t have any background in accounting and they’re not familiar with accounting software or terminology. This can be a problem because they can’t afford to pay for basic accounting services. Most new business owners choose to do their own Bookkeeping for cost reasons.
Hiring a professional bookkeeper can be extremely helpful for new business clients who want to keep their books in good shape. However, there are a few guidelines you need to follow in order to get the best possible service. Make sure to follow the given points:
- Don’t use an accounting software with limited functionality
When you’re first starting out, it’s easy to be tempted to save money by using a free accounting software. You should aware of few things about basic accounting software.
- It can be hard to find support for cheap or free software.
- The software might have bugs that only an experienced financial professional can detect.
- Free software is often single-entry instead of double-entry, which means there’s a higher likelihood of hard-to-diagnose errors.
- In case if an upgrade is required to an advanced solution like QuickBooks hosting, you may face difficulties in moving from your current program.
So the best advice is to encourage new business owners to invest in the best software they can. It might cost a little more upfront, but it’ll save them time, money, and headaches down the road. Cloud based accounting systems like QuickBooks enterprise cloud hosting can be an ideal choice when starting out with a startup.
2. Get basic training
As a new business owner, it’s crucial to keep your books in good condition and categorizing transactions in your bank feeds is one of the best ways to do that. You should also know how to create invoices and other simple things you might need to do. Additionally, it’s important to know about the common pitfalls to avoid making mistakes, the best way to ensure this is to get basic training; of course it requires time but it goes a long way.
3. Check your books more frequently
New businesses can become established very quickly, and the business owner who has time to do their own bookkeeping today may not have time to stay on top of it three months from now. This is why checking in on your books frequently is important — it will be much easier for you to find someone to take over the bookkeeping duties for your business if you are already on top of it. Also if your books are not behind for a long period, it is a sign you are managing the task effectively. Good accounting software like QuickBooks enterprise hosting can come in handy for monitoring your books on a month to month basis.
4. Understanding the important parts in a report
Financial analysis can be a very daunting task for new business owners, but understanding some of the basics is crucial in keeping your business afloat. You should have a good grasp of key reports such as the P&L (Profit and Loss) and Balance Sheet. Knowing which accounts should never dip into the negatives and how to run a comparative report will help you avoid any potential costly errors.
5. Do not rush — Give yourself time
Keep in mind that business owners likely don’t have an extensive background in accounting or bookkeeping like accountants. The things that come easy to accountants with their years of education and experience are completely foreign to them. It may take you a month just to grasp the basics whereas it comes naturally to a bookkeeper or accountants; don’t be hard on yourself and give it some time, things will get clearer slowly.
6. Hire a Professional Bookkeeper
If you can swing it, we recommend finding a professional bookkeeper to take care of your business’s books on a monthly or quarterly basis. This is especially important in the early stages, when you’re most likely to make mistakes. This will give you more peace of mind and boost your confidence until you gain more knowledge and increase your accounts managing abilities.
7. Be patient with outside accounting help
It’s important to remember what it was like when you first started your business — you probably did everything yourself, even the things you weren’t good at. And as you grew, it was probably really hard to let go of some of those things, even if you didn’t particularly like them. You might not have been particularly fond of “outsiders” coming in and implying you were doing things wrong with your company accounts, even if you’d hired them to help with your business.
If you’re a new business owner, you might need some extra help when it comes to keeping your books in good shape. A professional bookkeeper can really come in handy in this situation. The key for new business owners is to keep things as simple as possible and matched to your business’s needs at the moment. That way, you can avoid any unnecessary complications down the road.
Created on Oct 12th 2022 07:00. Viewed 189 times.