Have you started a new business, or are you considering starting one? In both cases, Congratulations! Small business requires a lot of time and energy, and one person alone cannot manage everything efficiently! It would be best to get professional assistance to manage and expand your small business without any hurdles.
Bookkeeping is a term that might be new to small or new businesses. Many people who know it think it is an extra investment and unnecessary for a small business, but hiring a bookkeeper can be a saviour in knight for your small business. Let’s dig into the concept of bookkeeping, its methods, signs you need a bookkeeper, and what a bookkeeper can do for your small business!
What is Bookkeeping?
Bookkeeping is a term used in the business and finance world that means keeping the record of accounts and financial transactions of the company daily! Bookkeeping is a key to accurate financial reports, maintaining a business, analysing the finances and making future strategies.
Methods of Bookkeeping:
Different bookkeeping methods can be applied for different small businesses depending on their requirements.
- Single-Entry Bookkeeping
- Double-Entry Bookkeeping
- Cash-Based or Accrual-Based Bookkeeping
What Does A Bookkeeper Do?
A bookkeeper keeps the check and balance on the incoming and outgoing business transactions, keeps the record of credits and debits, tabulates and calculates them categorically, creates income and cashflow statements, processes payrolls, helps in strategic analysis of finances and makes future growth plans.
14 Things A Bookkeeper Can Do for Your Small Business
So, if you are thinking how can a bookkeeper help you grow your business, or why should you invest in a bookkeeper for your small business? Then keep reading!
Day-To-Day Account Management
A bookkeeper keeps a record of all the incoming and ongoing payments. He can do it manually or using specialised software, as YRF Accountants do. It saves much time and keeps track of daily sales and purchases.
Keeping Check on Cash Flow
Small businesses can run out of cash due to poor balance and planning. A bookkeeper ensures that the business has day-to-day cash flow and, makes strategies to regulate it and inform if it needs external financial help and loans.
Helps You in Foreign Currency Transactions
Many small-scale businesses find it hard to deal with foreign orders, as it has to deal with taxes, customs and currency conversions. A bookkeeper ensures the accurate maintenance of foreign bank accounts and uses current exchange rates. He also helps to calculate profit rates easily, improve the customer relationship and ease the expansion of your business globally.
Maintaining Up-To-Date Records Categorically
A bookkeeper maintains the consistency between all the transactions and their record. He reports everything categorically, like sales, purchases, profit, loss, payrolls and others, for a clearer picture and better understanding.
Tax Preparation
Taxation deadlines are strict and can cause disturbance and even fine if not met on time. A bookkeeper ensures timely tax payments and devises strategies to reduce taxes.
Financial Reports
By the end of the month, a bookkeeper makes a financial report on the basis of monthly activities to give you an overview of where your business is standing, identify problems and build future strategies.
Payroll Processing
A bookkeeper will ensure all the payrolls are arranged on time and distributed efficiently. This helps to strengthen the workforce and maintain discipline in the team. He can also help to keep the taxes low.
Compliance with Law
The taxation laws keep updating; a bookkeeper ensures that your business complies with all the current laws and rules so that you don’t have to face the legal complexitites. He can also help to deduct taxes while observing the legal rules and code of conduct.
Invoice Preparation
To ensure timely payments from buyers or suppliers, a bookkeeper makes timely invoices and sends them for a smooth payment. He then keeps a record of receivable payments and ensures to keep track of late payments and add them to the record.
Consultancy
A bookkeeper can offer valuable insights and consultancies for your problems. A bookkeeper has a problem-solving approach. He is trained to tackle problems without any panic. He will help you solve it and guide you on how to avoid them in the future.
Future Strategies To Improve Finances
A bookkeeper identifies the business patterns, shortcomings and scope for the future through their financial reports and analytical skills. He can make valuable suggestions and future startegies that will help to expand your business and generate more revenue exponentially.
Improved Relationship with Buyers
Good bookkeepers like at YRF Accountants help you retain a healthy relationship with your buyers regarding finances. They can schedule payments with suppliers on your behalf and ensure they are satisfied.
Identifying Loopholes
Small businesses can face stunted growth or even losses for fraud or corruption within the team. A good bookkeeper ensures transparency in all the invoice records maintenance and can quickly identify loopholes. This way, you can get the peace of mind that all your transactions are secure, accurate and transparent.
Dealing with Banks
A bookkeeper maintains all the bank feed. Now, many bookkeepers use digital software to align your record with your bank system to give you real-time information and an automated record of all transactions.
A well-documented financial structure of your business can help you approve loans from the bank. In this way, a bookkeeper can help you approve loans from banks to expand your small business.
When Your Small Businesses Need A Bookkeeper?
- Your records are not updated
- Unstable cash flow
- You have taxation issues
- You want a loan from the bank
- You lack time
- You are bad in numbers
- There’s a stunt profit rate
- You want to expand your small business
- There’s a disconnection between profits and sale
YRF Accountants understand the value of working with a small business. We are known for our experienced and licenced bookkeepers and accountants who have helped numerous happy customers over the years. So, for any query or professional services, give us a call! You can count on our experienced specialists!