The Fine Art of Business Bookkeeping
Business bookkeeping work is a challenge that many people struggle to deal with. There are, however, a handful of key concepts to keep in mind over the course of a business year that'll help you do the job better.
Get Receipts for Everything
Especially if you're operating a business that goes through a lot of equipment or consumables, there's a pretty good chance you're going to want to itemize deductions at tax time. Get receipts for everything. Encourage employees to make sure they're collecting receipts for every business lunch, piece of mail and cartridge of printer ink they pay for. Even if you have doubts about the deductibility of a specific expense, it's better to sort that out months down the road than to not have the receipts in hand when you need them.
Technology is a critical component of modern business bookkeeping efforts. If you're working with a professional bookkeeping services provider, it's a good idea to ask them which software suite they use and have the same systems installed on your company's computers. Not only will this speed up the process of tallying up numbers, but it'll also allow you to make bigger decisions.
Focus on Streamlining Processes
With a modern bookkeeping system in place, you can begin to take a closer look at the processes your company uses. Identifying places where the money is being lost or could be made generally begins with opening the books.
For example, a bar should be ordering supplies, food, and drinks based on what is evident in the books. If they're seeing huge outlays for drinks that don't sell well, that's going to become apparent when the books are opened up. The requisition process should be built around these numbers to ensure the bar isn't carrying excess inventory that can't be quickly converted into cash. Likewise, anything that isn't being converted to cash should be marked down until it does become cash with the aim of reinvesting in things that do sell.
Follow the Data
One of the biggest challenges business operators face is admitting what the numbers are telling them. Suppose you own a clothing store that's focused on streetwear, but the books say accessories are where you make money. Confronting that fact rather than resisting it will tell you how to grow your business. Your business bookkeeping service can help you interpret your numbers if you need additional help.