Love it or hate it, bookkeeping is an integral part of running a business. We do it for many reasons.
We always say that there are two sides to accountancy, the traditional side, the boring bit, the processing of receipts and invoices and the strategic side, where the information will aid you in decision making within your business.
So traditional bookkeeping; all income and expenditure needs to be recorded, it also needs to be recorded within the correct nominal codes (headings or expense categories) bank accounts need to be balanced and VAT returns completed and submitted.
Are you aware of how much VAT you may need to pay at the end of the quarter? If you were up to date, you would be able to assess this throughout the quarter.
Since Making Tax Digital came into force, all VAT registered businesses need to submit VAT returns through digital software, something like QuickBooks or Xero. This means that the bookkeeping needs to also be on digital software, sometimes called Cloud Accounting.
By completing your bookkeeping accurately and in a timely fashion this would help reduce the accountancy fees of your year end accounts.
You would also know at any given point, who still owed you money and how long for. Likewise, you would know who you owed money to and for how long.
Most cloud accounting software would have the ability to make chasing outstanding payments much easier. Thereby improving your cashflow but also helping you to act before it is too late.
The strategic side, which is where we think it gets interesting, this is where it will help your business become more profitable and grow, should you want to.
By setting up your financial software to produce relevant data and processing the transactions in the correct way, this will help with your understanding how you are doing as a business.
Are you aware of how much your business is making per day, per week, month or year? Is this better than last year? Do you know the true profit margin on your different services or products? Are you pushing and selling the right things?
By bookkeeping in a strategic and timely way, the answers to these questions would be readily available.
With a recession looming, we have to ask are you bank ready? If the need to borrow arises, either for assets or cashflow, banks will want up to date financial information. Would you be able to provide this in the time needed? If you are up to date and accurate, then you are well on your way to being ready.
The key for you as business owners is to decide where your time is best spent. Is this bookkeeping or delivering the products and services that you set up in business to do. No one sets up to do bookkeeping, unless of course you are an accountant or bookkeeper! And are you any good at it, will you actually cause more work. We do have clients that do a good bookkeeping job and we can provide access to a free bookkeeping course. But then again, it is not for anyone.
You could of course employ a bookkeeper to work for you.
At Footprints Accountancy we are happy to do as much or as little as possible. We are happy to work alongside you and support where needed. We have a variety of situations for a variety of clients. For some we do it all, others are happy to do their own, for others it is a bit of mix where we help where needed.
Also, you are not locked into any services with Footprints Accountancy. You may need us to do more for a period of time and then you take it back in house. Or the opposite where you were doing it for yourselves, and the business has grown, and you need more time and freedom within the business and need Footprints to pick this up for you.
Need help with bookkeeping?
Contact us today to learn more about how we can help you with your business bookkeeping.