We speak with small business owners daily, and understand that for many businesses, it is difficult to find the time and personnel to focus on keeping their financial records up-to-date. For many businesses, time is an issue, and the day-to-day operations quickly take precedence over the maintenance of the company’s bookkeeping.
With that said, the bookkeeping process is an integral part of any business, and can offer owners a number of short and long term benefits.
Manage Your Cash
Cash management is one of the most important aspects of running a business, and accounts for every dollar and cent that your business spends, and makes. Documenting this on paper allows for the bookkeeper and business owner alike to get a sense of where the business is financially, and where it is able to go in the future. These accurate records are also able to assist businesses when applying for business loans, as it makes it easier for lenders to make decisions about your business.
Informed Business Decisions
A professional bookkeeper offers business owners the ability to make smart business decisions, especially when it comes to identifying money-making opportunities, avoiding cash-flow problems, and finding ways to increase income and decrease spending. An experienced bookkeeper is able to bring your books up-to-date, while offering key financial advice with regards to how your business is using available finances. As owners become more involved with the process, they can reap the benefits in their day-to-day uses as well, making informed business decisions based on the financial status of their business.
Keep Up With Compliance
Regardless of where your business is located, you must be in compliance with business tax laws. One of the most beneficial aspects of a clean set of books is the ability to pay income taxes, payroll taxes, workers compensation, and sales tax, while remaining worry-free about the possibility of an audit. An experienced bookkeeper is able to offer you a professional paper trail that can be given to the IRS or CRA in the event of an audit, and includes items such as cancelled checks, receipts, tax returns, and other important documents.
Reduce Risk and Gain Knowledge
Maintaining a clear set of books not only helps to create a concise paper trail in the event of an audit, it also reduces the risk associated with fraud and embezzlement within the business. An experienced bookkeeper is able to look over your books, and provide you with an insight into any suspicious business transactions or unbalanced accounts.
Hiring a professional bookkeeper is a big step for many businesses, and can come with a great deal of risk at the owner’s expense. When your business is ready to outsource these tasks, owners need to take into account the experience and capabilities of the bookkeeping firm. A great bookkeeper can provide you with key information that paints a picture of your business’s financial structure, and can offer financial advice in regards to how your business can improve and grow. For some helpful tips on how to find a bookkeeper or accountant that is right for your business, see our “Find a Bookkeeper or Accountant in 4 Easy Steps” article.
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