Top 5 Bookkeeping Tips in 2023
We are on our way to the 2nd half of the year and whoa, summer’s almost over in Lil’ Rhody! I only say that because it’s in RI, summers go by real quick since they are here to stay for only about 3 months! Just like summers in RI, the year is halfway over!
Every business has their own way of dealing with their finances. They might still write things down in a notebook if they’re a micro business, or they upgraded to a spreadsheet or better yet, they have expanded into an accounting software. However you decide to do your bookkeeping, there are a few things to take into consideration. There are many tips I can give you but here are the top 5 that will help you grow and understand your business:
- Build a Foundation – every business needs somewhere to start and the Chart of Accounts is where every book of business starts. This is a list of your assets, liabilities, equity, income & expenses. This is the most important part of any business! The end result in a bookkeeping cycle are the financial statements, so you always want to ensure that the Chart of Accounts is in good standing.
- Keep your Business & Personal transactions separate – By doing this, your balance sheet would look like gold to any banker or investor! When you start purchasing personal items from your business accounts, your equity is affected and that will change your bottom line. Most of my clients that are looking to finance or even sell their business needs to make sure that their balance sheet is pristine (which is comprised of assets, liabilities & equity).
- Automation – Now, I’m not saying you should go out and buy accounting software but it helps a great deal if you have 50+ transactions or multiple bank accounts. Having a cloud based accounting software like QuickBooks Online can simplify your bookkeeping or you can delegate this task to your trusted bookkeeper.
- Prepare for the unexpected – you should always prepare for the unexpected and I teach my clients to do that with Profit First. This book teaches you a structured way of saving your money like the envelope system if you know what that is. It has helped many business owners, including myself, be profitable, understand cash flow & grow the business.
- Outsource – Often times, small business owners find themselves focusing on activities that don’t directly affect generating revenue. Everyone wants to be a do-it-yourselfer but is it really helping your bottom line? Think about how much time you could save if this project was delegated to a professional? (That would be me 😀 )
Remember that keeping good records ensures that you comply with government regulations and helps you keep control over your finances.
Bookkeeping Towne provides outstanding service to our clients because of our dedication to the three underlying principles of trust, service & empowerment.
Thank you all for reading!
Dolly Towne, CEO & Growth Advisor
Bookkeeping Towne, LLC
Website: www.bookkeepingtowne.com
Email: dolly@bookkeepingtowne.com
Phone: (401) 474-5229
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