The bookkeeping process can be a difficult task for many small business owners, especially when it is busy season and the company is struggling to find time to complete their projects. It is common for many small businesses to struggle to keep their bookkeeping up-to-date as day-to-day operations are able to quickly outweigh the importance of spending the time to review the finances. With this said, the bookkeeping process is an integral part of business, and must be taken seriously. Below are five tips that will help contractors stay on top of their bookkeeping, and be prepared for this year’s tax season:

A Little Bookkeeping
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1. Technology is your friend

There are a number of tools available that will help you keep track of your small business’s finances. Many companies rely on Microsoft Excel, which allows you to create spreadsheets of various expenses and incomes. Excel is a great tool, but is also very simple, and was not created specifically for the purpose of bookkeeping or accounting. With this said, there are dedicated bookkeeping and accounting applications that are much more suitable for tracking expenses, invoicing, cost-plus hours, and other vital information. For example, Kashoo and QuickBooks are two great accounting applications that can help you keep your finances in order, while keeping track of other important information.

2. Put your business first

It is important to focus on your business first over prospective clients and customers. As previously mentioned, the bookkeeping and accounting process is an integral part of business, and allows for you to have the information necessary to make informed business decisions.

3. Outsource when possible

Hiring employees can be a colossal task for small business owners, and has the potential to drain your bank account, as well as your time, very quickly. High turnover, combined with the necessary training, can put a great deal of stress on the business owner. One way to overcome this problem is to hire only as many employees as necessary, and outsource projects when possible. This allows for you to be worry-free about annual salaries, holiday pay, overtime pay, and benefits, as well as the process of hiring and training employees.

4. Don’t Do Too Much

Keeping track of your finances is important, but there is generally always something else that needs to be dealt with right now (or so it seems). It is essential that you spend 30 minutes a week to look over your business’s finances, and keep track of your weekly tasks. Whether it is Monday morning or Friday afternoon, mark the time on your calendar and don’t let anything distract you.

5. Don’t forget about your bookkeeping!

If you are struggling to find time to set aside, try enlisting the help of a professional bookkeeper. Professional bookkeepers are valuable assets to business owners, and can help by offering key financial advice, while keeping track of your books. Many firms are able to share responsibilities, which allows for less billable hours and an overall smaller bookkeeping rate.

Although bookkeeping is commonly put on the backburner by many companies, it is essential for business owners to keep up-to-date on their business finances. A strong set of books allows you to make informed business decisions, while having a strong understanding of your financial situation. By utilizing the technology available, putting your business first, outsourcing when possible, and focusing 30 minutes a week on your bookkeeping, you will be able to stay on top of your bookkeeping while keeping focused on your main work.

This post was written by Dene Paquin, Marketing Strategist for LedgersOnline, an online-based bookkeeping and accounting firm, and LedgerDocs, an online document management application built for the collaboration of document for small business owners, bookkeepers, and accountants.

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