How Bookkeeping Software Can Save You Time, Stress, And Money

The vast majority of us would rather devote our time to our families, our friends, and the activities that bring us joy than to scour our homes for lost invoices or deal with the complexities of bookkeeping.

You might save up to two hours each week by using bookkeeping software since it makes it simple for you to keep track of both your revenue and your expenses. Additionally, it will automatically calculate the totals for you, saving you time that you would have spent on laborious computations.

When you combine this with an automatic bank reconciliation process that will only take ten minutes per month (instead of two hours), you will see that your savings are substantial.

Do you find that you don't have enough time in the day to keep up with the ever-increasing bookkeeping requirements of your company? Or do you have the impression that the stacks of receipts and bills are building into a mountain that you will never be able to scale? You're not alone. It is common for owners of small businesses to struggle with keeping their finances in balance, which is why it is essential for them to make use of accounting software.

By minimising errors caused by manually entering data, automating processes, and producing reports on an ongoing basis, bookkeeping software can help you save time, reduce stress, and save money. When you have assistance of this kind, you won't have to worry as much about the paperwork and will be able to devote more of your time and effort to expanding your company.

Maintaining an accurate record of your financial situation is essential if you want to avoid wasting time, experiencing less stress, and spending additional money. Despite this, many people still spend a significant amount of time every year trying to search down documentation that they need for their accountant. Accounting software provides a solution that will assist you in automating the process, allowing you to devote less of your time to boring paperwork and more of it to more fruitful activities.

Reduce Stress, Costs, And Time

When running a small business, especially in the beginning stages, you will need to take on many different roles. However, aiming to please everyone all of the time is not a recipe for success; rather, it is a recipe for tragedy. The pressure will be alleviated if you get yourself a bookkeeper.

Since I was 19 years old, I've been working in the startup business. I've spent many years attempting to be everything to everyone, from working at motorcycle dealerships and information technology enterprises to running my own accounting office (I'm in my late 40s at the moment, but I'll keep my exact age a little secret).

Working on my own start-ups and counselling others on their ventures has made me realise that as a business owner, at some point you have to take a step back and delegate tasks or you run the risk of entering the burn-out phase.

When one's body and mind have both reached their limits, it is no longer possible for them to contribute anything of value to the world. Therefore, the moment has come to take action.

The financial management of your company is one of the tasks that may be delegated with the greatest ease, and bookkeepers play a significant role in assisting small business owners in accomplishing this goal.

The following is a list of the five most important things that you can do for yourself and your business before, during, and after contracting the services of a bookkeeper. This list was compiled with the goal of making the process as simple and stress-free as possible.

Learn to Recognise Your Strengths

If you have the ambition to be an entrepreneur and went into company so that you could control your own fate, then you should take charge of your own life.

To paraphrase what Michael E. Gerber says in his book "The E-Myth," if you're in the pie business, your primary goal should be to create the most delicious, authentic-tasting pies possible so that you run out every single day. Maintain a focused concentration.

In a similar vein, think about the activities that bring you the most joy, and then seek out other people who feel the same way.

Be Familiar With Your Own Numbers

The old adage about giving a guy a fish and teaching him to fish is still sound advice. In a similar vein, it is essential to the operation of any firm to have a solid understanding of what each of its figures represents and how they were calculated. However, this does not obligate you to complete the work in question.

When this happens, you need the help of a reliable bookkeeper. Bookkeepers can aid you in understanding, designing, and implementing systems, in addition to assisting in the implementation and maintenance of those systems.

Bookkeepers aren't just the little old lady who sits in the corner and enters data anymore; they do much more than that now. But if keeping the books isn't why you went into business in the first place, then you should leave that to the professionals.

Eliminate The Paper

If you have loose papers lying around the office, you will have to put in additional effort, spend more time, and incur additional costs to handle them. Therefore, the simple solution is to get rid of it.

The best practise moving forwards is to save data in an electronic format, including copies of invoices and receipts. When you do this, you will not only make your accountant and the people in charge of taxes pleased, but you will also have the peace of mind that comes from knowing the information is saved securely and can be retrieved at any time.

I was once subjected to an audit, and I remember that I was able to have everything handled in about five hours simply because the material was immediately accessible.

There are products available in the market, such as MYOB's Capture App, that can aid with this (a competent bookkeeper will be able to assist you in setting it up if you get stuck), as well as create the systems necessary to handle it in an integrated manner.

Do Not Attempt to Prepare Your Own Tax Returns

This is a significant deal in my book. It all comes down to concentrating on your strengths; for example, if you aren't an accountant, you shouldn't make an effort to become one. Put your trust in those trained in tax law.

A bookkeeper will not only assist you in getting all of the pertinent information organised and liaise with your accountant when it comes time to file your taxes at the end of the year, but they will also be able to take care of things like your quarterly BAS (Business Activity Statements) and payroll obligations as your company expands.

Bookkeepers who are Registered BAS Agents (which indicates that they are licenced by the Tax Practitioners Board and recognised by the Australian Taxation Office) are able to offer advice on all GST-related concerns, which is extremely helpful in determining which expenses can be claimed.

If this is not handled properly, the owners of small businesses will frequently be passing up the opportunity to claim GST credits, which is problematic for a startup because cash flow is always an issue. For just this reason, a few of the companies with whom I've collaborated have let thousands of dollars go unclaimed.

Adapt to Modern Technology

It's 2020. This era is known as the digital age. There is an app for practically anything these days. Therefore, now is the moment for everyone to get on board! The ability to save both time and money is one of the primary benefits that the modern technological revolution has provided to small enterprises. And last, we are back where we started: the cash flow, right?

Who wouldn't like to have more money stashed away in their bank account? When the appropriate technological solutions are utilised, efficiencies will be improved, and costs will be reduced.

When it comes to your technology, a bookkeeper will also prove to be of great assistance. They are able to undertake an entire company systems review and provide recommendations for things that you can apply to improve the operations of the business smoother, more cost-effective, and just plain easier for both you as the owner and your team.

How to Save Time and Money with Bookkeeping

Some owners of small businesses consider bookkeeping to be a time-consuming and unpleasant task that distracts them from running their company.

Accounting is not something that needs to scare or boring you in any way. The proprietors of successful businesses don't look at bookkeeping in a bad light. They have instead implemented a few fundamental processes in order to maintain control over the paperwork. They alleviate a significant amount of tension, along with saving time and money.

Follow these fundamental steps to gain control of — and maintain control over — the bookkeeping chores associated with your company:

Make Use of Accounting Software

Become at least somewhat familiar with the programme in a general sense: Be able to create reports and other types of data, as well as input checks and reconcile bank accounts. The next step is to choose one of the following five methods to keep it:

A. You could do it by yourself. Take a course on how to use the software and set up some time each week to enter data and check that it matches up with the bank statements. If you become behind on entering transactions, it will be quite tough to catch up to where you were before. Procrastination is what most individuals do at this point, so they toss their receipts and bank statements into a box. If something like this occurs, you should often select option E from the list below.

B. Educate and employ a member of the family to keep the books and records. It is still quite important to have a fundamental working knowledge of the software and procedures, particularly from the perspective of a supervisory role and an internal control system.

C. Hire is currently enrolled at a nearby college and is working towards a degree in accounting. In most cases, student workers come at a very reasonable cost to their employers. Just keep in mind that you should not allow the student an excessive amount of leeway in terms of check signature or control over the payment of bills. Even if the student is operating the system, you are still required to monitor their work in order to guarantee that your records are accurate.

D. Employ a local bookkeeper to offer the services you require, and then hand over the books to your certified public accountant at the end of the year so they can assist you with financial planning and tax preparation. There is no question that a bookkeeper will have greater expertise and experience than either you or a member of your family, but the cost per hour will be higher. One clever tactic is to negotiate a fixed monthly charge for the service so that you can better plan your finances around it.

E. Have your certified public accountant handle all of your accounting needs, including tax preparation. When your book collection becomes so disorganised, this is the result that often occurs. Even though this may appear to be the most expensive choice, your CPA team will most likely have the highest level of expertise and will be able to accomplish the work in the shortest amount of time possible. In spite of the fact that the hourly rates are greater, the charge ought to be comparable to what you would have paid a bookkeeper throughout the year in order to have them do it on a monthly basis. Another advantage of relying only on your accountant is the peace of mind that comes with knowing the job was done correctly.

Scan All of Your Important Documents, Including Receipts And Business Cards

There are a few software packages, such as NeatReceipts, that are capable of importing data directly into QuickBooks. When you use a technology of this kind, not only will you save time and paper, but it will also help audit-proof your record.

Keep Personal and Business Accounts Separate

Avoid combining the two. Bookkeeping will be lot easier for you if you keep your personal and business bank accounts and credit cards separate. This will also help you maintain your corporate veil, which is important if you have a formal entity.

Avoid Cash

Instead, make consistent use of either your debit or credit card. When you spend the money, you can no longer keep tabs on any possible write-offs. If you have to withdraw money from an ATM for some reason, make a note of the reason for the withdrawal on the receipt that you receive.

Go Paperless

It can be a nuisance to store tax paperwork for a period of at least six years. Another choice is to invest in a compact fireproof safe that can be used to store essential personal documents like a passport, life insurance policies, and other such items, in addition to a flash drive that has frequent backups of your bookkeeping software and tax returns. Consider storing these records and scanned files off-site either physically or through an online data storage service for an additional layer of data protection.

Automatic Mileage Tracking

It can be a real nuisance to maintain a written record of all of your commercial, philanthropic, and medical vehicle travel. Consider using a service that is assisted by satellites, as well as an application for your phone or a piece of software.

At Least Twice Per Year, Confer With Your Certified Public Accountant

Examine your business plans, financials, tax deposit amounts, tax strategies, and payroll procedures. It would be unwise to leave your plans up to chance given how much money taxes cost. Spending a few minutes each day can result in savings of thousands of dollars over time. Keep in mind, too, that these meetings are the perfect opportunity for your CPA to provide you with new tactics and ideas. If during the meeting you offer suggestions and your CPA responds by criticising them, you should look for another accountant. Find a planner that is constantly providing you with new ideas and plans of action to implement in your business.

How Accounting Services Can Save Your Company

One of the most fundamental aspects of accounting is bookkeeping. In the event that your taxes are audited, this ensures that they are completed accurately and that your finances are in line.

However, keeping your books in order is not something you should do merely in order to reduce your tax liability. When done correctly, it can also help you keep your sanity and make it easier for you to manage the financial aspects of your business. Bookkeeping provides owners of small businesses with an excellent opportunity to make the most of their financial resources and increase profitability.

It's true that keeping accurate books can assist you avoid getting into tax difficulties and guarantee that you have a clear picture of where your money is going. However, this is putting too little stock on bookkeeping. It is capable of a great deal more.

Here are numerous key reasons why you should keep a separate chequebook and set of books for each of your enterprises, in case you are still undecided about whether or not you require the services of a dedicated bookkeeper.

Corporate Veil

Keeping individual and business finances separate, as required under the corporate veil, is one of the most important justifications for forming a company. The presence of a separate chequebook demonstrates that you recognise the company as an independent entity in its own right. Additionally, having different chequebooks and bank accounts will urge you to keep your personal and work finances distinct from one another. (In case you were wondering, that's not a good thing. Not only may it lead to a financial mess, but it also has the potential to leave your personal assets vulnerable in the event that you run into legal troubles.

Taxes Saved

Keeping your personal and business finances separate will help you improve your record-keeping practises, ensure that no payments are missed, and give you with better records to improve your tax return. We are all aware that "poor books" will cost us money when we file our tax return; thus, if we can avoid incurring that cost in the first place, we should do so. Not to mention the fact that having accurate books makes it much simpler to prepare tax returns.

Audit Protection

If you have a separate chequebook and financial records, you will have a better chance of surviving an audit conducted by the ATO without suffering significant consequences as a result of the audit. When personal and business expenses are mixed in the same chequebook, the Australian Taxation Office (ATO) will frequently deny a lot of expense claims. (As you can see, we warned you that it was terrible.)

Reduced Anxiety and Improved Mental Health

You will feel constant stress to take care of things when your books are disorganised, which might finally cause you to fall apart as a result of the situation. There is already enough stress involved in running a business. Your financial situation won't get any easier if you make it more complicated than it has to be.

When starting a new business, it could end up saving you both time and money in the long run if you maintain a separate transaction account and work with a bookkeeper. In addition, take into account the cost and importance of maintaining mental clarity. Those who put their trust in your ability to make decisions will be grateful to you. Not only this, but a good bookkeeper may supplement the work that your accountants do, which will make their jobs easier as well, thus hiring one will make the lives of your accountants easier.

Enhancing Decision-Making

As was mentioned before, keeping separate chequebooks is the first step towards improved record-keeping, more accurate tracking of expenses, and more accurate budgeting, all of which are necessary for good decision-making. If you run a company and don't keep proper records, how can you ever expect to be a successful business owner? What's more, if you can't perceive your company as it is right now, how can you possibly project that it will be successful in the future? When you have a distinct understanding of where you now are, you also have a distinct understanding of where you have the potential to go.

Improved Business Analysis

An inspection of the many aspects of a company to determine how well it is operating as a whole is an example of what is meant by "business analysis." A more precise analysis, which in turn translates into an easier time estimating the requirements of your organisation, might be the outcome of accurate bookkeeping. If your company's finances are a disorganised mess, it might be difficult to determine the areas in which your business needs to improve.

Investors Can See Your Value More Easily

Investors are known to be somewhat miserly, and with good reason: putting money into any company is a leap of faith. When you keep your books in a way that is both clear and succinct, it is much simpler to present both the current and the projected financial status of your business to potential investors. If a company's financial situation is a shambles, there won't be many investors eager to put their money into it.

Improved General Cash Flow

Keeping accurate books involves much more than simply putting your bank accounts and monthly financial statements in the appropriate folders. If you have a reliable bookkeeping team, you will have a better sense of which bills have not yet been paid, as well as whether or not any of your customers or suppliers owe you money. As a consequence of this, you are able to examine your own procedures and identify areas in which you may make improvements.

Your total cash flow will improve, which is a nice extra benefit, simply because you will have a better idea of where the money needs to go and will spend less time digging through your cluttered financial situation.

The benefits of keeping your own books are not limited to the ones that have been discussed above. In a nutshell, proper bookkeeping lays the groundwork for a prosperous near-term and end-of-year financial outcome. You wouldn't start a company without a business plan, and you shouldn't manage a company without using bookkeeping services.