For many small businesses bookkeeping is the last thing that business owners want to think about.
You may throw all your receipts invoices and bills in a box somewhere and forget about them. Then you get a letter from the taxation office asking why you haven’t submitted any tax returns for five years and suddenly you panic!
The thought of wasting a couple of hours a week doing bookwork when you could be making another sale or spending quality time with the kids means that many small businesses do not keep up to date with the paperwork. Here are a dozen reasons why you need bookkeeper:
- A bookkeeper can spend that couple of hours a week keeping your paperwork up to date so you can relax or work more on your business.
- A bookkeeper does bookkeeping for a living, so that they will not only spend less time doing the books than you would take, they know what they are doing, and have to be efficient and accurate in their work so you will have correct financial information.
- A bookkeeper understands the need to access financial records quickly and easily so all the receipts that you would have thrown in a shoebox somewhere, will be neatly sorted and filed by your bookkeeper saving you so much time when you your are looking for the proof of purchase for an item you need repairing.
- There’s a legal requirement to have your business financials in order. If the taxation department decided one day to undertake an audit on your business, wouldn’t you like to know that your books were up to date, giving them less time and less opportunity to snoop around in your affairs.
- Have your bookwork in order means that if you need to make a quick business decision that could affect you financially, you’ll have all the relevant information at hand to help you make the best decisions.
- With a bookkeeper working regularly on your financials they’ll see patterns emerging and can bring matters to your attention that you may have overlooked. Generally by the time your accountant sees your figures, (which could be months, or even years after the event) your circumstances could well have changed, and the figures they see would not be a true reflection of your current situation.
- Well managed bookkeeping will provide you with financial statements such as Profit and Loss and a Balance Sheet. They are also needed if you are applying fro credit from vendors or financial institutions. Keeping up to date with your paperwork avoids the risk of late payment fees, penalties and fines.
- Have you ever had a creditor chase payments, and in a panic you make a payment, then later you realize that you had already settled the account so you’ve ended up paying twice? Having a bookkeeper would reduce that risk, because they would ensure that you are aware of which accounts have been paid, and which accounts are outstanding.
- Your bookkeeper can quickly provide you with reports so you can track your sales patterns, any peaks and slow times, so you can plan ahead for such events
- What may be mundane and boring to you is an enjoyable task for your bookkeeper, so you don’t need to put off the “inevitable”, your bookkeeper can relieve you of the hassle and stress of facing a task you really do not want to do but know it should be done.
- When it comes time to sell your business, buyers will be able to see the true value of the business that you have worked so hard in developing.
Many small businesses fail within the first five years, and often it’s because they have not been thorough with their paperwork and keeping track of their financials. Bookkeeping is such an important part of your business – don’t put it in the too hard basket. Bookkeeping is essential if you want to achieve success with your business.