Money, Like People, Flocks To The Places It knows It'll Be Well Cared For
If you're like me, you've read entire libraries worth of how-to books on money management and you've realized that they all say the same things. In order to manage money well you should do the following four things: Spend Wisely, Save, Give, and Invest.
I find that the first rule, spending wisely, is the one that sets the tone for the rest. The easiest way to spend wisely is to know exactly where your money is going.
Tracking your businesses’ spending is not just important for taxes, its important in helping you make those important decisions, such as rather or not you are ready for a new office, or are able to expand and hire another employee.
Knowing what’s coming in and what’s going out also allows you to create a future for your business, How much revenue do you want to attract this year? How much did you make last year? A well setup and executed bookkeeping system can help you with all these questions.
Read on for 4 simple steps to create a well executed bookkeeping system...
Step One: Get QuickBooks
It’s the most widely used accounting programs out there. You can be assured that your accountant is familiar with it. I also recommend that customers get QuickBooks for PC because the Mac software just isn’t as good. There are a number of versions of QuickBooks available but for a new business and one that is still in the small stages QuickBooks Pro is sufficient.
Step Two: Hire an experienced Bookkeeper or Accountant to help you set up your books
If you are familiar with accounting and bookkeeping hiring an accountant or bookkeeper may not be necessary, but if you are like most business owners hiring someone who is knowledgeable about accounting and bookkeeping will save you a world of hurt in the long run. The QuickBooks Pro advisor website is a great resource for finding knowledgeable professionals who can set up your books and give you a basic tutorial on how to use the program.
Step Three: Record Keeping 101
I get questions from client all the time about what they should keep and what should get thrown away. I like to tell folks to keep three running file cabinets and an open in box:
Open Inbox: the first stop for all mail (snail or email) Invoices, bills, receipts. They all go here, so they can get entered into QuickBooks and sorted to their respective files once entered.
File Cabinet 1: Accounts Payable
This file cabinet or folder will hold all the files related to your vendors like Home Depot, Staples, you landlord etc. It’s a great resource if a question comes up as to rather or not you paid an outstanding invoice.
File Cabinet 2: Accounts Receivable
This File cabinet or folder will hold all the files related to your customers. Here you will keep track of Sales orders, Invoices, and other customer related files including check stubs from paid invoices
File Cabinet 3: Banking and Employee Information
This folder is great for keeping copies of Banking Deposits, Bank Statements, Employee information, and insurance information.
Step Four: Ask yourself if hiring a bookkeeper or doing it yourself is more appropriate
Sometimes your time is better suited for doing the things that you excel at. If accounting and bookkeeping is not your forte, you might want to consider hiring a professional to keep your books for you. A professional should be able to give you a snap shot of your business on any give day including account balances and income statements.
-Denise Cooper CEO/Founder
If this is something you are interested in please email me at email@example.com