Small businesses have a
bunch of issues to look after. It is extremely important to set the priorities
straight out for smooth business operations. There are several aspects you need
to pay extra attention to when your business is in a nascent stage. Accounting
is one of those key aspects to take into consideration while growing your
business. We have listed down some of the best accounting practices for small
business owners to follow.
Separate bank accounts
Opening up a bank
account exclusively for your business is the first step, to begin with. That is
where you keep all your earnings. It helps you most when you tally your
expenses and incomes. It is also useful when you issue a new credit card for
your business. It is basically to keep a track of your billing payment and
expenditure.
If it is a partnership
or LLC, then it is a compulsion. But even for single-owner businesses, we
recommend this.
Track every expense
Every penny counts! For
any business to be successful, you need to watch your expenses closely and
analyze them as well. From cash flow to financial statements, everything has to
be scrutinized thoroughly. It is a great habit that will help you in the long
run leading to profitability.
Choosing appropriate
accounting software
Technology is now an
inseparable part of any business today. It’s no longer an option in this
digital world. It is good to be equipped with the latest software and tools of
your business. Look out for the right features that simplify the accounting
processes. There are several cloud-based accounting software in the market
today. You can access them anywhere and they provide you with business analysis
reports with valuable insights.
We at CapActix, have
expert software accounting consultants who know the right set
of tools for your business. They will walk you through the entire process of
seamless integration of software with business operations.
Automate revenue
recording system and monitor your receivables
It often becomes hectic
to track down revenue from sales, loans and other finances. As mentioned
earlier, with the help of the right software, automate the revenue lifecycle.
It will bring in more accuracy and eliminate manual labor from the
process. Verify invoices with actual payments received. Otherwise, you will end
paying extra taxes what nobody wants to do!
Monitor your variable
expenses and fixed overhead
It is essential to
examine every single dollar going out of your pocket, be it variable and fixed
overhead cost. It is basically your business budget. As a part of good
accounting practices, you should be aware of business capital expenditure. This
will help better plan and save your finances.
Plan your taxes and pay
on time
You don’t want to get
penalized. Do you? We advise you to use the services of tax professionals. It
will not just help you plan tax payments better but save your money as well. It
will also ensure that you file your tax returns timely. Initially, you may not
be able to pay taxes in full. Taxes sometimes can be tricky to understand and
calculate and small businesses have to suffer. A seasoned accountant will make
it easy for you. He will facilitate you with a payment plan to pay your taxes
in installment over a certain period of time.
Reconcile your banks,
vendors and customers’ account regularly
Your business needs
sound accounting skills to manage cash flow and control accounts. Accounts
reconciliation helps you rectify issues and verify transactions to balance your
business accounts. CapActix’s control
accounts reconciliation services help you bring transparency and detect any
unusual transactions.
Maintain proper record
of inventory
Establish proper
inventory controls. Monitor the usage of goods and perform the timely audit of
inventory. Make sure everything is in order and not misplaced. Allow the entry
to the limited personals. Having an inventory management software helps control
your stock more efficiently. We at CapActix, offer custom inventory
management services to manage your stocks. It brings you to
achieve more accuracy and efficiency in business operations.
Establish a sound
internal control system
There are chances of
fraud and misuse of funds in any business. A strong internal control system is of the utmost importance to minimize risks. Our risk management and internal control
consulting services enable you to establish a sound internal control process to
achieve your business goals.
Hire a professional
accounting firm
Accounting services for
any business are inevitable. Nobody can replace an experienced accountant to
work out with your finances. As you are going to occupy your core work, it
is better to leave it up to experts. From making tax plans to achieving
accuracy in financial data, a professional accounting firm can help you build a
robust financial management system for your business growth.
Winding up/Final
thoughts/Conclusion:
It is imperative to put
good accounting practices in place to ensure the smooth functioning of your
business. Be aware of risks and other critical factors regarding your accounts
and eliminate them. We suggest if you don’t have time or skills, take the help of
an accountant to deal with it.
forIf you have trouble
handling your accounts or keeping your books, get in touch with us at biz@capactix.com or
simply call us on +1 201-778-0509.
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