Small Business Bookkeeping Tips

Small business owners wear many hats and one of them is your business’ books. Bookkeeping is an essential part of running a small business, even if it's not glamorous or fun. Up-to-date and accurate accounting records can keep your business on the road to success. Keep detailed records, track expenses, separate business and personal finances, and develop a budget.

Keep Your Business & Personal Accounts Separate - This will help you be ready for year-end reporting and reduce headaches when trying to separate spending. If your business is a corporation or an LLC it's required to have a separate business account.

Choose a Bank You Like - Big banks can often offer more resources but smaller banks may be more flexible when it comes to line of credit or offering lower rates for loans. It's important to have a good relationship with your bank and can make running your business a lot easier. Consider the "perks" a bank might offer like payroll services, bonuses for opening an account, lower rates, etc. At a minimum make sure they are able to offer you a checking and savings account (preferably free of fees or no fees with a minimum balance), a credit and/or debit card, online banking, and checks.

Create a Weekly Bookkeeping Routine - Record transactions in your accounting software. Document and file receipts. Review unpaid bills and write checks or schedule bill payments. Prepare and send client invoices. Review your account for cash flow.

Create a Budget - A budget is a guideline to keep your business afloat. Estimate future revenue and expenses to help you make educated decisions about acquiring equipment and other business expenses.

Keep Detailed Records - Whether you choose to keep paper records or go electronic, it's important to maintain accurate invoices and expense receipts.

Choose Your Accounting Software Carefully - Many accounting options are available online, some are even free. Compare what accounting services you need for your business versus what the software offers.

The importance of accounting for small businesses can’t be underestimated. Whether you’re starting a brand-new business or you have some experience under your belt, creating a solid accounting plan can help you monitor and maintain your financial health.

Our Success Coaches can help you along the way or refer you to resources.