Posted on: 26 April 2017
Call it procrastination, or just being too caught up in everything else, but small business owners frequently need to play "catch-up" when it comes to their bookwork and financial records. The pressure is definitely on when it comes to the end of the fiscal year, as well, but with some planning and forethought there is no need to endure these panic situations. What can a small business person do to put in place better practices, so that there aren't any nasty surprises in store?
The first thing that needs to be done is to make a commitment to treating administrative work as a priority. It needs to be treated just as carefully as marketing and sales. Business records should not be left to pile up in a corner somewhere, for future action.
Stop Scratching Your Head
Many people think that they will remember details for subsequent action, but this is very rarely the case. It may not be possible to rely on the information printed on a receipt, either, as the ink can fade over time and it may not have been perfectly legible in the first place. Did you pay for that office product in cash?
Taking Advantage of Technology
At the very least, some form of electronic accounting system should be implemented in every business. It's also a good idea to integrate your accounting system with your bank records, ideally so that any transactions are automatically fed between the two. Get into the habit of scanning any receipts that you get through electronic apps that are now readily available. This data can then be captured into the system and balanced, before you forget everything.
Feeding the Cash Flow
It's also a good idea to invoice for the products or services immediately they are delivered. Every day that such a task is put off adds to the stress on your cash flow and one of these days will create a nasty "crunch" point, which could have been avoided.
Keeping on Top of Money
Once you've got into the habit of sending out invoices properly, then you should ensure that you also chase any overdue payments. Many people don't like confrontation and will simply let these things slide. You should ensure that you prioritise follow-up calls and remember that late payments could get you into trouble with your suppliers.
Most Important of All
When all of these business practices have been implemented and new software integrated, it's time to get a professional to look over all of your good work. A qualified accountant can often spot mistakes before they become big problems and certainly help you when it comes to sending in those tax returns.Share