If you ask any business owner why they started their own company, very few will say, “to spend hours on accounting.” However, many entrepreneurs find the financial challenges of keeping their business afloat an unnecessary distraction to the passion that drove them to start the business in the first place.
The key is to set the right foundation and operate according to firm processes and principles. If you do this, your month-end accounts should feel painless and free of stress.
The good news is, you can fix your accounting at any stage of your business growth. Here are a few tips to keep your finances in check and ensure that your business is on track:
Hire a professional:
The best way to get your finances in order fast is to hire an accountant who has the experience, knowledge and systems in place to help you run your business. You can choose the level at which they are integrated into your business. Perhaps you need a full-time resource, or you are still growing and simply need a contractor to balance your books every month. Either way, you will be surprised at how much time is freed up when someone else is focusing on processing your invoices, collecting money from debtors and calculating your breakeven point.
Get a great system:
There is an app for everything, and that includes your accounting system. There are many great accounting platforms that will automate and streamline your processes, giving you more time to focus on running your business. If you work with an accountant, they will recommend a few options, otherwise, there are many easy-to-use online systems that will synchronise your accounts.
Give payment incentives:
Whether you are selling a product or service, it’s important to give your customers incentives to pay quickly or on time. As a service provider, implement a strict 50% deposit structure to keep your cash flow up and charge interest on late payments. You may also want to investigate ways of rewarding and engaging with repeat clients.
Remember your tax obligations:
In addition to the money you need to put aside for the taxman, you also need to be diligent in recording your business expenses. Speak to an accountant or tax expert on the full spectrum of deductibles that you can claim for. You may be missing out on claiming for a whole series of expenses that you didn’t even think of! As with any financial best practice, keep detailed records of all your income and expenses. Every slip, no matter how small, counts!
In summary, accounting can be extremely simple. It only becomes complicated when a business owner becomes too busy to accurately keep records, invoice timeously or calculate their tax obligations. If you would like to streamline your accounting processes, get in touch with us for some simple, business-saving solutions.