If your books are a mess, then so is your business. To truly understand the health and sustainability of your company, you must keep your books clean and consistently up-to-date. While these tedious tasks can often be distracting, at Your Balance Sheet, we recommend several ways for you to keep your books nice and tidy.
1. Get Serious and Stay Serious
Understanding how important it is to have consistent bookkeeping practices is only the first step. In a pinch, it’s easy to let things slide and then find yourself back at square one, sitting in front of piles of paper, lists of uncategorized expenses, unprepared reports, and no idea where your finances stand. Just like you can’t go through life without eating, your business can’t go through life without bookkeeping.
2. Use an Accounting Service
If you feel your efforts are far more efficiently invested in growing your business, we completely understand. One way to “get serious” about your business is to hire an accounting service for your bookkeeping. It’s their job to “get serious” about your bookkeeping, and they’re motivated to keep everything in order. The cost of hiring a professional is far worth the expense of a financial mess.
3. Get Rid of Excess Accounts
In some cases, accounts that were necessary at one point in the history of your business are not necessary anymore. Streamlining your bookkeeping processes is paramount to a clean system. If you’re working with an accounting service, they can help you understand which of your accounts are still needed and irrelevant, and which accounts may be combined.
4. Commit to an In-Depth Monthly Review
Keeping up is one thing, but analysis and decision making is another. Your accounting service can provide an in-depth monthly financial report for you to look over. However, if you’re doing the books yourself, it is incredibly important for you to discipline yourself to do a monthly review with a fine-tooth comb, analyzing expenses and income trends, making future predictions, and planning accordingly.
Staying on top of the little, redundant, tedious activities is the foundation that will keep your business alive and well. Don’t neglect bookkeeping, and consider hiring an accounting service who can sustain that foundation as you grow your business on the front end.