When you start a business, you’re excited about multiple things such as getting your name out there, creating a great client base and sharing your products or knowledge with others. We doubt your first thoughts were about how to track expenses, generate accounts or managing the books!
Here at Aston Black Accountants, we have the top 3 mistakes you can make when starting and owning a small business and tell you how to keep on top of your accounts better…
1. Leaving The Bookkeeping For Too Long
The accounts won’t go away no matter how long you leave them. Putting off the bookkeeping, again and again, will ultimately lead to more hard work when you get down to doing it or even mistakes being made in the process. Also, if you don’t keep on top of your business records, financial gains and outgoing, HMRC can fine you for not keeping accurate records. Leaving it all will become an even more overwhelming task with a lot of paperwork!
We’d recommend setting aside just a small amount of time each week to keep on top of your books so that you will always have accurate files about your business’ financial situation. This will also mean you remember what expenses you’ve had that week rather than having to think about them months down the line if not stored properly. Also you will notice any financial issues as early as possible leaving time for any necessary corrections.
2. Mistakes With Recording Your Expenses And Sales
The more accurate information you keep a record of for your business, the quicker and easier it will be to resolve your accounts. Also, the more you do and have organised yourself, the lower the costs will be with your bookkeeper or accountant.
Use a simple system that enables you to input all of your data with accuracy and efficiency. Make sure the way you log your figures stays consistent so it is easy to check for any errors.
3. Consistent Transactions Managed Inconsistently
If you have repeat transactions in your business such as a monthly subscription for something as simple as printer ink, make sure you put these monthly transactions in the same category each time. This is so your accountant can see all your costs easily and see you have claimed the maximum allowable amount for tax. If not they will have to spend extra time finding these repeated monthly expenses which could mean higher costs for yourself.
- Track your time- even if it isn’t billable. This will help you gain a better grasp on the profitability of your business so you can invoice and set prices accordingly.
- Keep up to date with your invoices.
- Set out a list of tasks which need to be completed each and every week.
- Maintain a list of all bills due for payment so you can plan your cash flow and budget better.
- Check your bank transactions to remember what you’ve bought.
If you still need any further assistance with managing your finances or finding out how your business can benefit from our accountancy services in Milton Keynes, do not hesitate to call on 01908 046 964.